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Executive Summary
The Borough of Surf City's audit report for the year ended December 31, 2022, includes financial statements of various funds and account groups, prepared on a regulatory basis as required by the State of New Jersey. The audit expresses an unmodified opinion on the regulatory basis financial statements but an adverse opinion on U.S. Generally Accepted Accounting Principles (GAAP) due to material variances between the regulatory basis and GAAP. The report also covers internal controls and compliance with laws, regulations, contracts, and grant agreements. The auditor's report, dated September 27, 2023, identifies a material weakness related to the maintenance of the general ledger.
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--- Document: 2022 Audit Document ---
BOROUGH OF SURF CITY
COUNTY OF OCEAN, NEW JERSEY
FOR THE YEAR ENDED DECEMBER 31, 2022
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Exhibit
Page
Independent Auditor's Report
1
Independent Auditor's Report on Internal Control Over Financial Reporting and on
Compliance and Other Matters Based on an Audit of Financial Statements
Statements Performed in Accordance with Government Auditing Standards
5
Basic Financial Statements
Current Fund
Statements of Assets, Liabilities, Reserves and Fund Balance - Regulatory Basis
A
9
Statements of Operations and Changes in Fund Balance - Regulatory Basis
A-1
11
Statement of Revenues - Regulatory Basis
A-2
12
Statement of Expenditures - Regulatory Basis
A-3
14
Trust Fund
Statements of Assets, Liabilities, Reserves and Fund Balance - Regulatory Basis
B
19
General Capital Fund
Statements of Assets, Liabilities, Reserves and Fund Balance - Regulatory Basis
C
20
Statements of Fund Balance - Regulatory Basis
C-1
21
Water/Sewer Utility Fund
Statements of Assets, Liabilities, Reserves and Fund Balance - Regulatory Basis
D
22
Statements of Operations and Changes in Fund Balance - Regulatory Basis
D-1
23
Statement of Fund Balance - Regulatory Basis
D-1a
24
Statement of Revenues - Regulatory Basis
D-2
25
Statement of Expenditures - Regulatory Basis
D-3
26
General Fixed Assets Account Group
Statements of Assets, Liabilities, Reserves and Fund Balance - Regulatory Basis
E
27
Notes to Financial Statements
31
Supplementary Exhibits:
Current Fund
Schedule of Cash - Collector/Treasurer
A-4
67
Schedule of Due From State of New Jersey - Senior Citizens' and Veterans' Deductions
A-5
68
Schedule of Taxes Receivable and Analysis of Property Tax Levy
A-6
69
Schedule of Tax Title Liens Receivable
A-7
70
Schedule of Revenue Accounts Receivable
A-8
71
Schedule of 2021 Appropriation Reserves
A-9
72
Schedule of Encumbrances Payable
A-10
75
Schedule of Prepaid Taxes
A-11
76
Schedule of County Taxes Payable
A-12
77
Schedule of Local District School Taxes Payable
A-13
78
Schedule of Regional School Taxes Payable
A-14
79
Schedule of Various Reserves
A-15
80
Schedule of Federal and State Grants Receivable
A-16
81
Schedule of Reserve for Federal and State Grants – Appropriated
A-17
82
Schedule of Reserve for Federal and State Grants – Unappropriated
A-18
83
BOROUGH OF SURF CITY
COUNTY OF OCEAN, NEW JERSEY
TABLE OF CONTENTS
YEAR ENDED DECEMBER 31, 2022
PART I
Exhibit
Page
BOROUGH OF SURF CITY
COUNTY OF OCEAN, NEW JERSEY
TABLE OF CONTENTS
YEAR ENDED DECEMBER 31, 2022
PART I
Trust Fund
Schedule of Cash Receipts and Disbursements
B-1
87
Schedule of Due From Current Fund
B-2
88
Schedule of Due To/(From) Water Sewer Operating Fund
B-3
89
Schedule of Due to Current Fund - Dog License Fund
B-4
90
Schedule of Reserve for Dog Fund Expenditures
B-5
91
Schedule of Trust - Other Reserves
B-6
92
Schedule of Investments in LOSAP
B-7
93
Schedule of Reserve for LOSAP
B-8
93
General Capital Fund
Schedule of Cash
C-2
97
Schedule of Analysis of Cash
C-3
98
Schedule of Due (From)/To Current Fund
C-4
99
Schedule of Grants Recievable
C-5
100
Schedule of Deferred Charges To Future Taxation - Unfunded
C-6
101
Schedule of Improvement Authorizations
C-7
102
Schedule of Capital Improvement Fund
C-8
103
Schedule of Various Reserves
C-9
104
Schedule of Bonds and Notes Authorized but Not Issued
C-10
105
Water-Sewer Utility Fund
Schedule of Cash - Treasurer
D-4
109
Schedule of Analysis of Water/Sewer Utility Capital Fund Cash
D-5
110
Schedule of Water/Sewer Rents
D-6
111
Schedule of Fixed Capital
D-7
112
Schedule of Fixed Capital Authorized and Incomplete
D-8
113
Schedule of 2021 Appropriation Reserves
D-9
114
Schedule of Encumbrances Payable
D-10
115
Schedule of Prepaid Rents
D-11
116
Schedule of Accounts Payable
D-12
117
Schedule of Reserve for American Recovery Act
D-13
118
Schedule of Due From/(To) Water-Sewer Utility Capital Fund
D-14
119
Schedule of Due From/(To) Current Fund
D-15
120
Schedule of Improvement Authorizations
D-16
121
Schedule of Capital Improvement Fund
D-17
122
Schedule of Reserve for Amortization
D-18
123
Schedule of Reserve for Deferred Amortization
D-19
124
Schedule of Bonds and Notes Authorized but Not Issued
D-20
125
General Fixed Assets Account Group
Schedule of Changes in General Fixed Assets
E-1
129
Schedule of Financial Statement Findings - Government Auditing Standards
Schedule of Financial Statement Findings
133
Summary Schedule of Prior Year Audit Findings and Questioned Costs as Prepared by Management
134
Letter of Comments and Recommendations - Regulatory Basis:
Officials in Office and Surety Bonds
137
General Comments & Findings
139
Acknowledgment
141
PART II
PART III
************
BOROUGH OF SURF CITY
COUNTY OF OCEAN, NEW JERSEY
PART I
INDEPENDENT AUDITOR'S REPORT
AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
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INDEPENDENT AUDITOR’S REPORT
Honorable Mayor and Members
of the Borough Council
Borough of Surf City
Surf City, New Jersey
Opinions
We have audited the accompanying financial statements of the various funds and account group of the Borough of
Surf City, which comprise the statements of assets, liabilities, reserves and fund balance – regulatory basis as of
December 31, 2022 and 2021, and the related statements of operations and changes in fund balance – regulatory basis
for the years then ended and the statements of revenues – regulatory basis and statement of expenditures – regulatory
basis for the year ended December 31, 2022, and the related notes to the financial statements, as listed in the table of
contents.
Unmodified Opinion on Regulatory Basis of Accounting
In our opinion, the financial statements referred to above present fairly, in all material respects, the assets, liabilities,
reserves and fund balance – regulatory basis of the Borough of Surf City, as of December 31, 2022 and 2021, and the
results of its operations and changes in fund balance – regulatory basis for the years then ended and the statements of
revenues – regulatory basis, statements of expenditures – regulatory basis for the year ended December 31, 2022, in
accordance with the financial reporting provisions of the Division of Local Government Services, Department of
Community Affairs, State of New Jersey as described in Note 1.
Adverse Opinion on U.S. Generally Accepted Accounting Principles
In our opinion, because of the significance of the matter discussed in the Basis for Adverse Opinion on U.S. Generally
Accepted Accounting Principles section of our report, the financial statements referred to above do not present fairly,
in accordance with accounting principles generally accepted in the United States of America, the financial position
of the Borough of Surf City, as of December 31, 2022 and 2021, or the results of its operations and changes in fund
balance for the years then ended.
Basis for Opinions
We conducted our audit in accordance with auditing standards generally accepted in the United States of America
and the standards applicable to financial audits contained in Government Auditing Standards, issued by the
Comptroller General of the United States; and in compliance with audit requirements prescribed by the Division of
Local Government Services, Department of Community Affairs, State of New Jersey. Our responsibilities under those
standards are further described in the Auditor's Responsibilities for the Audit of the Financial Statements section of
our report. We are required to be independent of the Borough of Surf City and to meet our other ethical
responsibilities, in accordance with the relevant ethical requirements relating to our audit. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.
1
Basis for Adverse Opinion on U.S. Generally Accepted Accounting Principles
As described in Note 1, the financial statements are prepared by the Borough of Surf City, on the basis of the financial
reporting provisions of the Division of Local Government Services, Department of Community Affairs, State of New
Jersey, which is a basis of accounting other than accounting principles generally accepted in the United States of
America, to meet the requirements of the Division of Local Government Services, Department of Community Affairs,
State of New Jersey. The effects on the financial statements of the variances between the regulatory basis of
accounting described in Note 1 and accounting principles generally accepted in the United States of America,
although not reasonably determinable, are presumed to be material and pervasive.
Responsibilities of Management for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in accordance with
the financial reporting provisions of the Division of Local Government Services, Department of Community Affairs,
State of New Jersey. Management is also responsible for the design, implementation, and maintenance of internal
control relevant to the preparation and fair presentation of financial statements that are free from material
misstatement, whether due to fraud or error.
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from
material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion.
Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that
an audit conducted in accordance with generally accepted auditing standards, Government Auditing Standards, and
audit requirements prescribed by the Division of Local Government Services, Department of Community Affairs,
State of New Jersey will always detect a material misstatement when it exists. The risk of not detecting a material
misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery,
intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material
if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by
a reasonable user based on the financial statements.
In performing an audit in accordance with generally accepted auditing standards, Government Auditing Standards,
and audit requirements prescribed by the Division of Local Government Services, Department of Community Affairs,
State of New Jersey, we:
x
Exercise professional judgment and maintain professional skepticism throughout the audit.
x
Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or
error, and design and perform audit procedures responsive to those risks. Such procedures include examining,
on a test basis, evidence regarding the amounts and disclosures in the financial statements.
x
Obtain an understanding of internal control(s) relevant to the audit in order to design audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of
the Borough of Surf City's internal control. Accordingly, no such opinion is expressed.
x
Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting
estimates made by management, as well as evaluate the overall presentation of the financial statements.
x
Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise
substantial doubt about the Borough of Surf City's ability to continue as a going concern for a reasonable
period of time.
We are required to communicate with those charged with governance regarding, among other matters, the planned
scope and timing of the audit, significant audit findings, and certain internal control-related matters that we identified
during the audit.
2
Supplementary Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise
the Borough of Surf City’s basic financial statements. The accompanying supplemental schedules presented for the
various funds and letter of comments and recommendations section are presented for purposes of additional analysis
as required by the Division of Local Government Services, Department of Community Affairs, State of New Jersey
and are not a required part of the basic financial statements. Such information is the responsibility of management
and was derived from and relates directly to the underlying accounting and other records used to prepare the basic
financial statements. The information has been subjected to the auditing procedures applied in the audit of the basic
financial statements and certain additional procedures, including comparing and reconciling such information directly
to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial
statements themselves, and other additional procedures in accordance with auditing standards generally accepted in
the United States of America. In our opinion, the information is fairly stated, in all material respects, in relation to
the financial statements of each of the respective individual funds and account group taken as a whole.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated September 27, 2023, on
our consideration of the Borough of Surf City’s internal control over financial reporting and on our tests of its
compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The
purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and
compliance and the results of that testing, and not to provide an opinion on the effectiveness of the Borough of Surf
City internal control over financial reporting or on compliance. That report is an integral part of an audit performed
in accordance with Government Auditing Standards in considering the Borough of Surf City’s internal control over
financial reporting and compliance.
Respectfully submitted,
HOLMAN FRENIA ALLISON, P.C.
Jerry W. Conaty
Certified Public Accountant
Registered Municipal Accountant
RMA No. 581
Lakewood, New Jersey
September 27, 2023
3
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4
INDEPENDENT AUDITOR’S REPORT ON INTERNAL CONTROL OVER FINANCIAL
REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF
FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH
GOVERNMENT AUDITING STANDARDS
Honorable Mayor and Members
of the Borough Committee
Borough of Surf City
Surf City, New Jersey
We have audited, in accordance with the auditing standards generally accepted in the United States of
America, the standards applicable to financial audits contained in Government Auditing Standards issued
by the Comptroller General of the United States and audit requirements as prescribed by the Division of
Local Government Services, Department of Community Affairs, State of New Jersey, the financial
statements-regulatory basis of the Borough of Surf City, as of and for the year ended December 31, 2022,
and the related notes to the financial statements, which collectively comprise the Borough's basic financial
statements, and have issued our report thereon dated September 27, 2023. Our report indicated that the
Borough’s financial statements were not prepared in accordance with accounting principles generally
accepted in the United States of America but rather prepared in accordance with the regulatory basis of
accounting prescribed by the Division of Local Government Services, Department of Community Affairs,
State of New Jersey.
Report on Internal Control Over Financial Reporting
In planning and performing our audit of the financial statements, we considered the Borough's internal
control over financial reporting (internal control) as a basis for designing audit procedures that are
appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but
not for the purpose of expressing an opinion on the effectiveness of the Borough’s internal control.
Accordingly, we do not express an opinion on the effectiveness of the Borough’s internal control.
A deficiency in internal control exists when the design or operation of a control does not allow management
or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct,
misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in
internal control, such that there is a reasonable possibility that a material misstatement of the entity’s
financial statements will not be prevented, or detected and corrected on a timely basis. A significant
deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a
material weakness, yet important enough to merit attention by those charged with governance.
Our consideration of internal control was for the limited purpose described in the preceding paragraph and
was not designed to identify all deficiencies in internal control that might be material weaknesses or
significant deficiencies and therefore, material weaknesses or significant deficiencies may exist that were
not identified. We identified certain deficiencies in internal control, described in the accompanying
schedule of financial statement findings as Finding No. 2022-001 that we consider to be a material
weakness.
5
Report on Compliance and Other Matters
As part of obtaining reasonable assurance about whether the Borough's financial statements are free from
material misstatement, we performed tests of its compliance with certain provisions of laws, regulations,
contracts, and grant agreements, noncompliance with which could have a direct and material effect on the
determination of financial statement amounts. However, providing an opinion on compliance with those
provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The
results of our tests disclosed instances of noncompliance or other matters that are required to be reported
under Government Auditing Standards and audit requirements as prescribed by the Division of Local
Government Services, Department of Community Affairs, State of New Jersey and which are described in
the accompanying schedule of financial statement findings schedule of findings and questioned costs as
Finding No. 2022-001.
Borough of Surf City’s Response to Findings
The Borough of Surf City’s response to the findings identified in our audit is described in the accompanying
schedule of financial statement findings and questioned costs. The Borough’s response was not subjected
to the auditing procedures applied in the audit of the financial statements and, accordingly, we express no
opinion on it.
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance
and the results of that testing, and not to provide an opinion on the effectiveness of the Borough's internal
control or on compliance. This report is an integral part of an audit performed in accordance with
Government Auditing Standards and audit requirements as prescribed by the Division of Local Government
Services, Department of Community Affairs, State of New Jersey in considering the Borough’s internal
control and compliance. Accordingly, this communication is not suitable for any other purpose.
Respectfully Submitted,
HOLMAN FRENIA ALLISON, P.C.
Jerry W. Conaty
Certified Public Accountant
Registered Municipal Accountant
RMA No. 581
Lakewood, New Jersey
September 27, 2023
6
BASIC FINANCIAL STATEMENTS
7
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8
EXHIBIT A
Assets
Reference
2022
2021
Cash - Treasurer
A-4
10,366,042.44
$
9,577,474.40
$
Cash - Change Funds
A
600.00
600.00
10,366,642.44
9,578,074.40
Receivables With Full Reserves:
Taxes Receivable
A-6
137,013.35
95,422.21
Tax Title Liens Receivable
A-7
1,044.95
998.89
Property Acquired for Taxes - Assessed Value
A
4,725.00
4,725.00
Revenue Accounts Receivable
A-8
468.62
749.60
Due From Dog License Fund
B
162.29
376.52
Due from Capital Fund
C
1,500.71
170,828.49
144,914.92
273,100.71
10,511,557.36
9,851,175.11
Federal and State Grant Fund:
Grant Receivable
A-17
-
7,493.40
Due From Current Fund
A
28,603.77
28,262.14
28,603.77
35,755.54
Total Assets
10,540,161.13
$
9,886,930.65
$
DECEMBER 31, 2022 AND 2021
BOROUGH OF SURF CITY
CURRENT FUND
STATEMENTS OF ASSETS, LIABILITIES, RESERVES AND
FUND BALANCE - REGULATORY BASIS
The accompanying Notes to Financial Statements are an integral part of this statement.
9
EXHIBIT A
Liabilities, Reserves and Fund Balance
Reference
2022
2021
Appropriation Reserves
A-3, A-9
912,839.52
$
982,746.47
$
Encumbrances Payable
A-10
98,205.35
30,604.03
Tax Overpayments
A
16,562.37
9,923.23
Prepaid Taxes
A-11
402,908.29
428,309.18
Local District School Tax Payable
A-13
53,421.98
258,798.73
Regional School Tax Payable
A-14
2,489,718.91
1,949,392.91
Due To:
Federal & State Grant Fund
A
28,603.77
28,262.14
Trust Other Fund
B
58,262.68
36,655.93
Utility Capital Fund
D
-
345,000.00
County for Added Tax
A-12
86,835.99
51,691.82
State of NJ for Exemptions
A-5
802.75
667.75
Reserve for Tax Appeal
A-15
77,641.20
-
Reserve for Prepaid Beach Badges
A-15
32,000.00
27,676.00
Reserve for Hurricane Expense
A-15
321,623.24
114,818.01
Reserve for Library Aid
A-15
14.00
14.00
Reserve for Ocean County CARES Grant
A-15
187,862.99
187,862.99
4,767,303.04
4,452,423.19
Reserve for Receivables
A
144,914.92
273,100.71
Fund Balance
A-1
5,599,339.40
5,125,651.21
10,511,557.36
9,851,175.11
Federal and State Grant Fund:
Reserve for Grant Expenditures:
Appropriated
A-17
7,813.50
21,396.46
Unappropriated
A-18
20,790.27
14,359.08
28,603.77
35,755.54
Total Liabilities, Reserves and Fund Balance
10,540,161.13
$
9,886,930.65
$
DECEMBER 31, 2022 AND 2021
BOROUGH OF SURF CITY
CURRENT FUND
STATEMENTS OF ASSETS, LIABILITIES, RESERVES AND
FUND BALANCE - REGULATORY BASIS
The accompanying Notes to Financial Statements are an integral part of this statement.
10
EXHIBIT A-1
Reference
2022
2021
Revenue and Other Income Realized:
Fund Balance Utilized
A-2
1,672,500.00
$
1,550,000.00
$
Miscellaneous Revenue Anticipated
A-2
1,198,931.60
1,143,044.84
Receipts From Delinquent Taxes
A-2
100,317.08
123,677.10
Non-Budget Revenue
A-2
376,104.00
189,261.36
Receipts From Current Taxes
A-2, A-6
19,586,639.91
17,787,103.84
Other Credits To Income:
Unexpended Balance of Appropriation
Reserves
A-9
923,740.66
1,100,643.35
Cancellation of Grant Appropriations
A-17
7,813.50
4,929.20
Prior Years Interfunds Returned
A-1
174,944.70
20,409.05
Total Revenues
24,040,991.45
21,919,068.74
Expenditures:
Budget Appropriations Within "CAPS":
Operations:
Salaries and Wages
A-3
3,007,853.52
2,930,911.12
Other Expenses
A-3
2,879,696.48
2,828,088.88
Deferred Charges and Statutory
Expenditures
A-3
634,998.00
637,093.00
Appropriations Excluded From "CAPS":
Other Expenses
A-3
111,927.18
75,432.82
Capital Improvements
A-3
125,000.00
125,000.00
Deferred Charges
A-3
203,968.65
203,684.10
County Taxes
A-12
8,074,427.00
7,507,427.35
County Share of Added Taxes
A-12
86,835.99
51,691.82
Local District School Tax
A-13
901,281.00
861,394.00
Regional High School Tax
A-14
5,771,855.00
4,691,203.00
Cancellation of Grant Receivables
A-16
7,493.40
4,929.20
Reserve for Tax Appeals
A-15
77,641.20
-
Reund of Prior Year Revenues
A-4
11,825.84
-
Interfunds Advances
A
-
17,828.28
Total Expenditures
21,894,803.26
19,934,683.57
Excess in Revenue
2,146,188.19
1,984,385.17
Statutory Excess To Fund Balance
2,146,188.19
1,984,385.17
Fund Balance, January 1
A
5,125,651.21
4,691,266.04
7,271,839.40
6,675,651.21
Decreased By:
Utilized as Anticipated Revenue
A-2
1,672,500.00
1,550,000.00
Fund Balance, December 31
A
5,599,339.40
$
5,125,651.21
$
REGULATORY BASIS
YEARS ENDED DECEMBER 31, 2022 AND 2021
BOROUGH OF SURF CITY
CURRENT FUND
STATEMENTS OF OPERATIONS AND CHANGES IN FUND BALANCE -
The accompanying Notes to Financial Statements are an integral part of this statement.
11
EXHIBIT A-2
EXCESS/
BUDGET
REALIZED
(DEFICIT)
Fund Balance Anticipated
1,672,500.00
$
1,672,500.00
$
-
$
Miscellaneous Revenues:
Licenses:
Alcohol Beverages
1,400.00
1,400.00
-
Fees & Permits
10,000.00
27,232.00
17,232.00
Interest & Costs on Taxes
21,692.82
35,133.32
13,440.50
Beach Badge Fees
575,000.00
801,931.00
226,931.00
Energy Receipts Taxes
164,430.00
173,007.00
8,577.00
Uniform Construction Code Fees
95,000.00
107,801.10
12,801.10
Recycling Tonnage Grant
5,407.45
5,407.45
-
Clean Communities Program
11,905.90
11,905.90
-
Body Armor Replacement Fund
1,113.83
1,113.83
-
Community Development Block Grant
34,000.00
34,000.00
-
919,950.00
1,198,931.60
278,981.60
Receipts From Delinquent Taxes
90,000.00
100,317.08
10,317.08
Amount to be Raised by Taxes for
Support of Municipal Budget:
Local Tax for Municipal Purposes
4,765,000.00
5,207,240.92
442,240.92
Budget Totals
7,447,450.00
8,178,989.60
731,539.60
Non-Budget Revenue
-
376,104.00
376,104.00
7,447,450.00
$
8,555,093.60
$
1,107,643.60
$
YEAR ENDED DECEMBER 31, 2022
BOROUGH OF SURF CITY
CURRENT FUND
STATEMENT OF REVENUES - REGULATORY BASIS
The accompanying Notes to Financial Statements are an integral part of this statement.
12
EXHIBIT A-2
Analysis of Realized Revenue
Allocation of Current Tax Collection:
Revenue From Collections
19,586,639.91
$
Allocated To School and County Taxes
14,834,398.99
Balance for Support of Municipal Budget
4,752,240.92
Add:
Appropriation Reserve for Uncollected Taxes
455,000.00
Balance for Support of Municipal Budget
Appropriations
5,207,240.92
$
Delinquent Taxes:
Taxes Receivable
100,317.08
$
Analysis of Non-Budget Revenue
Miscellaneous revenue not anticipated:
Revenue Accounts Receivable:
Municipal Court Fines & Costs
26,635.47
$
Interst on Investments & Deposits
64,639.99
$
Insurance Refunds
87,689.34
Cable TV Franchise Fees
21,711.62
Recycling Receipts
7,739.60
Local Zoning and Occupancy
24,168.00
Land Use Board Reimbursement and Fees
2,500.00
Vendor Licenses
6,000.00
Prior Year Health Insurance Premium Refunds
15,134.48
Miscellaneous
35,702.02
Auction Proceeds
20,572.26
Off Duty Police
15,205.51
Escrow Refunds
27,925.71
LIT Fees
20,480.00
349,468.53
376,104.00
$
YEAR ENDED DECEMBER 31, 2022
STATEMENT OF REVENUES - REGULATORY BASIS
BOROUGH OF SURF CITY
CURRENT FUND
The accompanying Notes to Financial Statements are an integral part of this statement.
13
EXHIBIT A-3
ORIGINAL
BUDGET AFTER
PAID OR
BUDGET
MODIFICATIONS
CHARGED
ENCUMBERED
RESERVED
CANCELLED
General Appropriations
Operations - Within "CAPS"
GENERAL GOVERNMENT
General Administration
Salaries & Wages
75,000.00
$
65,000.00
$
61,835.46
$
-
$
3,164.54
$
-
$
Other Expenses
35,000.00
35,000.00
34,306.53
445.00
248.47
-
Human Resources
Other Expenses
5,000.00
5,000.00
1,000.00
-
4,000.00
-
Mayor and Council
Salaries & Wages
53,000.00
53,000.00
52,429.92
-
570.08
-
Other Expenses
5,500.00
5,500.00
4,736.60
-
763.40
-
Municipal Clerk
Salaries & Wages
95,000.00
85,000.00
64,852.09
-
20,147.91
-
Other Expenses
15,000.00
15,000.00
10,848.71
502.53
3,648.76
-
Financial Administration
Salaries & Wages
97,500.00
87,500.00
71,608.64
-
15,891.36
-
Other Expenses
18,000.00
18,000.00
12,321.82
28.78
5,649.40
-
Audit Services
Other Expenses - Annual Audit
21,000.00
21,000.00
18,916.66
-
2,083.34
-
Collection of Taxes
Salaries & Wages
55,000.00
50,000.00
43,154.86
-
6,845.14
-
Other Expenses
21,500.00
21,500.00
7,526.31
338.22
13,635.47
-
Assessment of Taxes
Salaries & Wages
22,000.00
22,000.00
17,902.50
-
4,097.50
-
Other Expenses
10,000.00
10,000.00
2,394.08
1,801.69
5,804.23
-
Legal Services
Other Expenses
17,000.00
17,000.00
8,192.00
-
8,808.00
-
Revision of Ordinances
Other Expenses
2,500.00
2,500.00
-
-
2,500.00
-
Engineering Services
Other Expenses
11,000.00
11,000.00
9,245.70
-
1,754.30
-
Review/Revision of Master Plan
Other Expenses
5,000.00
5,000.00
5,000.00
-
-
-
Municipal Court
Salaries & Wages
67,000.00
67,000.00
61,613.03
-
5,386.97
-
Other Expenses
9,000.00
9,000.00
2,758.20
111.32
6,130.48
-
Public Defender
Other Expenses
1,850.00
1,850.00
614.25
-
1,235.75
-
Land Use Administration:
Land Use Board
Salaries & Wages
10,000.00
10,000.00
9,975.09
-
24.91
-
Other Expenses
8,000.00
8,000.00
927.49
-
7,072.51
-
APPROPRIATIONS
EXPENDED
YEAR ENDED DECEMBER 31, 2022
BOROUGH OF SURF CITY
CURRENT FUND
STATEMENT OF EXPENDITURES - REGULATORY BASIS
The accompanying Notes to Financial Statements are an integral part of this statement.
14
EXHIBIT A-3
ORIGINAL
BUDGET AFTER
PAID OR
BUDGET
MODIFICATIONS
CHARGED
ENCUMBERED
RESERVED
CANCELLED
APPROPRIATIONS
EXPENDED
YEAR ENDED DECEMBER 31, 2022
BOROUGH OF SURF CITY
CURRENT FUND
STATEMENT OF EXPENDITURES - REGULATORY BASIS
Code Enforcement & Administration:
Other Code Enforcement Functions
Salaries & Wages
21,000.00
21,000.00
20,426.77
-
573.23
-
Other Expenses
3,000.00
3,000.00
-
-
3,000.00
-
Zoning Officer
Salaries & Wages
21,000.00
21,000.00
20,426.76
-
573.24
-
Other Expenses
2,500.00
2,500.00
996.05
1,273.58
230.37
-
Insurance:
General Liability
102,000.00
102,000.00
76,388.00
-
25,612.00
-
Workers Compensation
105,000.00
105,000.00
100,049.33
-
4,950.67
-
Employee Group Health
1,325,000.00
1,325,000.00
1,133,718.99
200.00
191,081.01
-
Health Benefit Waiver
Salaries & Wages
55,000.00
45,000.00
32,500.00
-
12,500.00
-
Public Safety Functions:
Police Department
Salaries & Wages
1,375,000.00
1,375,000.00
1,298,865.76
-
76,134.24
-
Other Expenses
70,000.00
70,000.00
40,212.55
17,102.94
12,684.51
-
Police Dispatch/911
Other Expenses
62,500.00
62,500.00
55,561.60
-
6,938.40
-
Office of Emergency Management
Salaries & Wages
3,500.00
3,500.00
3,000.00
-
500.00
-
Other Expenses
5,000.00
5,000.00
-
-
5,000.00
-
Aid to Volunteer Fire Company
25,000.00
25,000.00
25,000.00
-
-
-
Fire Hydrant Service
100,000.00
100,000.00
100,000.00
-
-
-
Municipal Prosecutor's Office
Other Expenses
12,500.00
12,500.00
7,270.90
708.33
4,520.77
-
Public Work Functions:
Streets and Road Maintenance
Salaries & Wages
75,000.00
105,000.00
97,573.43
-
7,426.57
-
Other Expenses
37,500.00
37,500.00
20,934.58
8,308.48
8,256.94
-
Solid Waste Collection
Salaries & Wages
280,000.00
305,000.00
286,885.93
-
18,114.07
-
Other Expenses
30,000.00
40,000.00
11,568.71
1,233.18
27,198.11
-
Building and Grounds
Salaries & Wages
150,000.00
150,000.00
146,693.80
-
3,306.20
-
Other Expenses
60,000.00
60,000.00
42,510.08
9,508.02
7,981.90
-
Vehicle Maintenance (Incl. Police Vehicles)
Salaries & Wages
50,000.00
50,000.00
48,520.22
-
1,479.78
-
Other Expenses
90,000.00
80,000.00
41,724.78
8,152.34
30,122.88
-
Health & Human Services Functions:
Board of Health
Salaries & Wages
3,000.00
3,000.00
2,113.00
-
887.00
-
Other Expenses
70,000.00
70,000.00
62,960.40
-
7,039.60
-
The accompanying Notes to Financial Statements are an integral part of this statement.
15
EXHIBIT A-3
ORIGINAL
BUDGET AFTER
PAID OR
BUDGET
MODIFICATIONS
CHARGED
ENCUMBERED
RESERVED
CANCELLED
APPROPRIATIONS
EXPENDED
YEAR ENDED DECEMBER 31, 2022
BOROUGH OF SURF CITY
CURRENT FUND
STATEMENT OF EXPENDITURES - REGULATORY BASIS
Environmental Health Services
Salaries & Wages
5,000.00
5,000.00
497.73
-
4,502.27
-
Other Expenses
1,000.00
1,000.00
-
-
1,000.00
-
Animal Control Services
Other Expenses
10,000.00
10,000.00
8,250.00
-
1,750.00
-
Contributions to Social Service Agencies
Senior Citizen Center (NJS 40:48-9.4)
5,000.00
5,000.00
-
-
5,000.00
-
Health Care Facilities (NJS 44:5-2)
100.00
100.00
-
-
100.00
-
Mental Health Facilities (NJS 40:48-9.4a)
100.00
100.00
-
-
100.00
-
Recreation of Services and Programs
Salaries & Wages
5,000.00
5,000.00
5,000.00
-
-
-
Other Expenses
2,000.00
2,000.00
104.99
-
1,895.01
-
Maintenance of Parks
Salaries & Wages
36,000.00
36,000.00
31,618.78
-
4,381.22
-
Other Expenses - Veterans' Memorial Park
2,500.00
2,500.00
882.41
-
1,617.59
-
Other Expenses - Other Facilities
4,000.00
4,000.00
1,555.73
-
2,444.27
-
Beach & Boardwalk Operations
Salaries & Wages
390,000.00
391,000.00
390,000.00
-
1,000.00
-
Other Expenses
80,000.00
79,000.00
66,926.17
9.46
12,064.37
-
Other Common Operating Functions (Unclassified)
Municipal Bus Service
Other Expenses
20,000.00
20,000.00
20,000.00
-
-
-
Accumulated Leave Compensation
Salaries & Wages
8,000.00
8,000.00
8,000.00
-
-
-
Celebration of Public Events
Other Expenses
1,000.00
1,000.00
-
-
1,000.00
-
Utility Expenses & Bulk Purchases
Electricity
30,000.00
30,000.00
20,662.33
-
9,337.67
-
Street Lighting
57,000.00
57,000.00
48,220.00
-
8,780.00
-
Telephone
40,000.00
40,000.00
27,950.45
-
12,049.55
-
Gas (natural or propane)
30,000.00
30,000.00
14,756.20
-
15,243.80
-
Telecommunications
7,500.00
7,500.00
4,480.65
-
3,019.35
-
Gasoline
75,000.00
75,000.00
62,553.83
-
12,446.17
-
Landfill/Solid Waste Disposal Costs:
Landfill/Solid Waste Disposal Costs
Other Expenses
180,000.00
170,000.00
110,322.76
-
59,677.24
-
Uniform Construction Code - Appropriations Offset
by Dedicated Revenues (N.J.A.C.5:23-4.17)
Construction Official
Salaries & Wages
25,000.00
25,000.00
18,678.10
-
6,321.90
-
Other Expenses
80,000.00
80,000.00
4,109.33
-
75,890.67
-
Total Operations Including Contingent Within CAPS
5,887,550.00
5,887,550.00
5,022,631.04
49,723.87
815,195.09
-
The accompanying Notes to Financial Statements are an integral part of this statement.
16
EXHIBIT A-3
ORIGINAL
BUDGET AFTER
PAID OR
BUDGET
MODIFICATIONS
CHARGED
ENCUMBERED
RESERVED
CANCELLED
APPROPRIATIONS
EXPENDED
YEAR ENDED DECEMBER 31, 2022
BOROUGH OF SURF CITY
CURRENT FUND
STATEMENT OF EXPENDITURES - REGULATORY BASIS
Detail:
Salaries & Wages
2,977,000.00
2,988,000.00
2,794,171.87
-
213,681.65
-
Other Expenses
2,910,550.00
2,899,550.00
2,228,459.17
49,723.87
601,513.44
-
5,887,550.00
5,887,550.00
5,022,631.04
49,723.87
815,195.09
-
Deferred Charges & Statutory Expenditures - Within CAPS:
Statutory Expenditures:
Contribution to:
Public Employees' Retirement System
70,927.00
70,927.00
70,927.00
-
-
-
Social Security System (O.A.S.I)
215,000.00
215,000.00
202,363.79
-
12,636.21
-
Police and Firemen's System of NJ
333,326.00
333,326.00
333,326.00
-
-
-
Unemployment Insurance
13,500.00
13,500.00
10,054.42
-
3,445.58
-
Defined Contribution Retirement Program
2,245.00
2,245.00
1,101.06
-
1,143.94
-
Total Statutory Expenditures Within CAPS
634,998.00
634,998.00
617,772.27
-
17,225.73
-
Total General Appropriations Within CAPS
6,522,548.00
6,522,548.00
5,640,403.31
49,723.87
832,420.82
-
Operations Excluded from CAPS:
Length of Service Awards Program (L.O.S.A.P.)
Other Expenses
52,000.00
52,000.00
-
-
52,000.00
-
Recycling Tax (P.L. 2007, c. 311)
Other Expenses
7,500.00
7,500.00
5,159.82
-
2,340.18
-
Public & Private Programs Offset by Revenues:
Clean Communities Program
11,905.90
11,905.90
11,905.90
-
-
-
Community Development Block Grant
34,000.00
34,000.00
34,000.00
-
-
-
Recycling Tonnage Grant
5,407.45
5,407.45
5,407.45
-
-
-
Body Armor Replacement Fund
1,113.83
1,113.83
1,113.83
-
-
-
State & Federal Programs - Local Match
4,006.17
4,006.17
-
-
-
4,006.17
Total Operations Excluded from CAPS
115,933.35
115,933.35
57,587.00
-
54,340.18
4,006.17
Detail:
Other Expenses
115,933.35
115,933.35
57,587.00
-
54,340.18
4,006.17
115,933.35
115,933.35
57,587.00
-
54,340.18
4,006.17
The accompanying Notes to Financial Statements are an integral part of this statement.
17
EXHIBIT A-3
ORIGINAL
BUDGET AFTER
PAID OR
BUDGET
MODIFICATIONS
CHARGED
ENCUMBERED
RESERVED
CANCELLED
APPROPRIATIONS
EXPENDED
YEAR ENDED DECEMBER 31, 2022
BOROUGH OF SURF CITY
CURRENT FUND
STATEMENT OF EXPENDITURES - REGULATORY BASIS
Capital Improvements - Excluded from CAPS:
Capital Improvement Fund
50,000.00
50,000.00
50,000.00
-
-
-
Rehabilitation of / Enhancement to Borough Property
75,000.00
75,000.00
440.00
48,481.48
26,078.52
-
Total Capital Improvements
125,000.00
125,000.00
50,440.00
48,481.48
26,078.52
-
Municipal Debt Service - Excluded from CAPS:
Interest of Notes
25,000.00
25,000.00
-
-
-
25,000.00
Total Municipal Debt Services
25,000.00
25,000.00
-
-
-
25,000.00
Deferred Charges - Municipal - Excluded from CAPS
Deferred Charges to Future Taxation - Unfunded:
Acquisition of Trash Truck
5,883.40
5,883.40
5,883.40
-
-
-
Reconstruction/Resurfacing of Various Sts
125,335.25
125,335.25
125,335.25
-
-
-
Reconstruction/Resurfacting Various Sts
12,000.00
12,000.00
12,000.00
-
-
-
Repair/Resurface Various Rds & Related Ecp
58,750.00
58,750.00
58,750.00
-
-
-
Replacement of Bulkheads
2,000.00
2,000.00
2,000.00
-
-
-
Total Deferred Charges
203,968.65
203,968.65
203,968.65
-
-
-
Total General Appropriations Excluded from CAPS
469,902.00
469,902.00
311,995.65
48,481.48
80,418.70
29,006.17
Subtotal General Appropriations
6,992,450.00
6,992,450.00
5,952,398.96
98,205.35
912,839.52
29,006.17
Reserve for Uncollected Taxes
455,000.00
455,000.00
455,000.00
-
-
-
Total General Appropriations
7,447,450.00
$
7,447,450.00
$
6,407,398.96
$
98,205.35
$
912,839.52
$
29,006.17
$
Federal & State Grants
52,427.18
$
Due to Trust Fund
8,000.00
Reserve for Uncollected Taxes
455,000.00
Cash
5,891,971.78
6,407,398.96
$
The accompanying Notes to Financial Statements are an integral part of this statement.
18
EXHIBIT B
Assets
Reference
2022
2021
Animal Control Fund:
Cash
B-1
551.09
$
785.15
$
Due From State Department of Health
B
3.00
3.00
554.09
788.15
Trust - Other Fund:
Cash
B-1
420,235.32
460,869.20
Due from Water/Sewer Capital
B-3
12.65
1,109.41
Due from Current Fund
B-2
58,262.68
36,655.93
478,510.65
498,634.54
Length of Service Award Program Fund ("LOSAP"):
Investments
B-7
1,044,088.31
1,238,293.20
1,044,088.31
1,238,293.20
Total Assets
1,523,153.05
$
1,737,715.89
$
Reserves
Animal Control Fund:
Due Current Fund
B-4
162.29
$
376.52
$
Reserve for Dog Fund Expendiures
B-5
391.80
411.63
554.09
788.15
Trust - Other Fund:
Various Reserves
B-6
478,510.65
498,634.54
478,510.65
498,634.54
Length of Service Award Program Fund ("LOSAP"):
Miscellaneous Reserve
B-8
1,044,088.31
1,238,293.20
1,044,088.31
1,238,293.20
Total Reserves
1,523,153.05
$
1,737,715.89
$
FUND BALANCE - REGULATORY BASIS
DECEMBER 31, 2022 AND 2021
BOROUGH OF SURF CITY
TRUST FUND
STATEMENTS OF ASSETS, LIABILITIES, RESERVES AND
The accompanying Notes to Financial Statements are an integral part of this statement.
19
EXHIBIT C
Assets
Reference
2022
2021
Cash
C-2
601,506.33
$
1,418,323.41
$
Grant Receivable
C-5
128,450.00
128,450.00
Deferred Charges To Future Taxation:
Unfunded
C-5
3,318,160.86
2,477,129.51
Total Assets
4,048,117.19
$
4,023,902.92
$
Liabilities, Reserves and Fund Balance
Improvement Authorizations:
Funded
C-7
561,194.16
$
698,057.08
$
Unfunded
C-7
2,333,800.82
1,958,369.25
Reserve for Encumbrances
C-7
25,453.00
65,479.60
Due To Current Fund
C-4
1,500.71
170,828.49
Capital Improvement Fund
C-8
860,432.50
865,432.50
Reserve for Debt Service
C-9
36,683.33
36,683.33
Reserve for Purchase of Lifeguard Boat
C-8
18,150.00
18,150.00
Reserve for Grant Receivable
C-5
128,450.00
128,450.00
Capital Fund Balance
C-1
82,452.67
82,452.67
Total Liabilities, Reserves and Fund Balance
4,048,117.19
$
4,023,902.92
$
There were bonds and notes authorized but not issued on December 31, 2022 of $3,318,160.86 and
on December 31, 2021 of $2,477,129.51.
DECEMBER 31, 2022 AND 2021
BOROUGH OF SURF CITY
GENERAL CAPITAL FUND
STATEMENTS OF ASSETS, LIABILITIES, RESERVES AND
FUND BALANCE - REGULATORY BASIS
The accompanying Notes to Financial Statements are an integral part of this statement.
20
EXHIBIT C-1
82,452.67
$
Balance, December 31, 2022 and 2021
REGULATORY BASIS
YEARS ENDED DECEMBER 31, 2022 AND 2021
BOROUGH OF SURF CITY
GENERAL CAPITAL FUND
STATEMENT OF CAPITAL FUND BALANCE -
The accompanying Notes to Financial Statements are an integral part of this statement.
21
EXHIBIT D
Assets
Reference
2022
2021
Operating Fund:
Cash
D-4
2,988,594.82
$
2,539,790.04
$
Change Fund
D
250.00
250.00
Due from Utility Capital Fund
D-14
-
19.67
Subtotal
2,988,844.82
2,540,059.71
Water/Sewer Rents Receivable
D-6
34,424.20
48,713.14
Total Operating Fund
3,023,269.02
2,588,772.85
Capital Fund:
Cash
D-4
595,092.87
46,999.49
Due from Water/Sewer Operating Fund
D-13
61,892.31
-
Due from Current Fund
D-15
-
345,000.00
Fixed Capital - Completed
D-7
8,360,588.16
8,360,588.16
Fixed Capital - Authorized and Uncompleted
D-8
1,195,887.98
1,195,887.98
Total Capital Fund
10,213,461.32
9,948,475.63
Total Assets
13,236,730.34
$
12,537,248.48
$
Liabilities, Reserves and Fund Balances
Operating Fund:
Accounts Payable
D-12
7,644.37
$
7,644.37
$
Encumbrances Payable
D-10
33,169.87
5,443.13
Appropriation Reserves
D-3
738,558.08
683,755.21
Due to Utility Capital Fund
D-14
61,892.31
-
Due to Trust-Other Fund
12.65
1,109.41
Prepaid Rents
D-11
16,553.52
19,050.13
Reserve for American Recovery Act
D-13
-
62,748.80
Subtotal
857,830.80
779,751.05
Reserve for Water/Sewer Rents Receivables
34,424.20
48,713.14
Operating Fund Balance
D-1
2,131,014.02
1,760,308.66
Total Operating Fund
3,023,269.02
2,588,772.85
Capital Fund:
Due To Utility Operating Fund
D
-
19.67
Capital Improvement Fund
D-17
528,315.51
503,315.51
Improvement Authorizations:
Funded
D-16
158,099.42
41,250.00
Unfunded
D-16
706,346.18
883,687.84
Reserve for Amortization
D-18
8,741,973.74
8,441,476.14
Reserve for Deferred Amortization
D-19
71,250.00
71,250.00
Capital Fund Balance
D-1(a)
7,476.47
7,476.47
Total Capital Fund
10,213,461.32
9,948,475.63
Total Liabilities, Reserves and Fund Balances
13,236,730.34
$
12,537,248.48
$
There were bonds and notes authorized but not issued on December 31, 2022 of $743,252.40 and
on December 31, 2021 was $1,043,750.00.
FUND BALANCE - REGULATORY BASIS
DECEMBER 31, 2022 AND 2021
BOROUGH OF SURF CITY
WATER/SEWER UTILITY FUND
STATEMENTS OF ASSETS, LIABILITIES, RESERVES AND
The accompanying Notes to Financial Statements are an integral part of this statement.
22
EXHIBIT D-1
Reference
2022
2021
Revenue and Other Income Realized:
Fund Balance Anticipated
D-2
980,000.00
$
980,000.00
$
Water/Sewer Rents
D-2
2,163,884.72
2,137,059.82
Fire Hydrant Service
D-2
118,400.00
118,400.00
Miscellaneous Revenues Not Anticipated
D-2
122,254.23
80,712.24
Other Credits to Income:
Appropriation Reserves Lapsed
D-9
676,166.41
698,275.23
Total Revenues
4,060,705.36
4,014,447.29
Expenditures:
Budget Appropriations:
Operating
D-3
2,325,000.00
2,235,000.00
Capital Improvements
D-3
110,000.00
110,000.00
Deferred Charges and
Statutory Expenditures
D-3
275,000.00
235,000.00
Total Expenditures
2,710,000.00
2,580,000.00
Excess in Revenue
1,350,705.36
1,434,447.29
Fund Balance, January 1
D
1,760,308.66
1,305,861.37
3,111,014.02
2,740,308.66
Decreased By:
Utilized as Anticipated Revenue
D-1
980,000.00
980,000.00
Fund Balance, December 31
D
2,131,014.02
$
1,760,308.66
$
BOROUGH OF SURF CITY
YEARS ENDED DECEMBER 31, 2022 AND 2021
REGULATORY BASIS
STATEMENTS OF OPERATIONS AND CHANGES IN FUND BALANCE
WATER/SEWER UTILITY OPERATING FUND
The accompanying Notes to Financial Statements are an integral part of this statement.
23
EXHIBIT D-1(a)
7,476.47
$
Balance, December 31, 2022 and 2021
YEARS ENDED DECEMBER 31, 2022 AND 2021
BOROUGH OF SURF CITY
WATER/SEWER UTILITY CAPITAL FUND
STATEMENT OF FUND BALANCE -
REGULATORY BASIS
The accompanying Notes to Financial Statements are an integral part of this statement.
24
EXHIBIT D-2
EXCESS/
ANTICIPATED
REALIZED
(DEFICIT)
Surplus Anticipated
980,000.00
$
980,000.00
$
-
$
Rents
1,660,000.00
1,204,485.50
(455,514.50)
Sewer Rents
-
959,399.22
959,399.22
Fire Hydrant Service
95,000.00
118,400.00
23,400.00
Miscellaneous Revenues Not Anticipated
-
122,254.23
122,254.23
2,735,000.00
$
3,384,538.95
$
649,538.95
$
Analysis of Miscellaneous Revenue Not Anticipated
Miscellaneous
118,818.01
$
Interest on Delinquents
2,227.11
121,045.12
Interest Earned in Utility Capital Fund
1,209.11
Total Miscellaneous Revenue Not Anticipated
122,254.23
$
BOROUGH OF SURF CITY
YEAR ENDED DECEMBER 31, 2022
STATEMENT OF REVENUES - REGULATORY BASIS
WATER/SEWER UTILITY OPERATING FUND
The accompanying Notes to Financial Statements are an integral part of this statement.
25
EXHIBIT D-3
ORIGINAL
BUDGET AFTER
PAID OR
BUDGET
MODIFICATION
CHARGED
ENCUMBERED
RESERVED
CANCELLED
Operating:
Salaries and Wages
600,000.00
$
600,000.00
$
317,625.37
$
-
$
282,374.63
$
-
$
Other Expenses
1,725,000.00
1,725,000.00
1,344,327.67
15,524.97
365,147.36
-
Total Operating
2,325,000.00
2,325,000.00
1,661,953.04
15,524.97
647,521.99
-
Capital Improvements:
Capital Improvement Fund
25,000.00
25,000.00
25,000.00
-
-
-
Capital Outlay
85,000.00
85,000.00
-
17,644.90
67,355.10
-
Total Capital Improvements
110,000.00
110,000.00
25,000.00
17,644.90
67,355.10
-
Debt Service:
Interest on Notes
25,000.00
25,000.00
-
-
-
25,000.00
Total Debt Service
25,000.00
25,000.00
-
-
-
25,000.00
Deferred Charges & Statutory Expenditures:
Deferred Charges:
Costs of Improvements Authorized:
Improvements to Water/Sewer System
175,000.00
175,000.00
175,000.00
-
-
-
Total Deferred Charges
175,000.00
175,000.00
175,000.00
-
-
-
Statutory Expenditures:
Contribution To:
Public Employees' Retirement System
54,621.00
54,621.00
54,621.00
-
-
-
Social Security System (O.A.S.I.)
40,000.00
40,000.00
19,687.12
-
20,312.88
-
Defined Contribution Retirement Plan
800.00
800.00
275.26
-
524.74
-
Unemployment Compensation Insurance
4,579.00
4,579.00
1,735.63
-
2,843.37
-
Total Statutory Expenditures
100,000.00
100,000.00
76,319.01
-
23,680.99
-
Total Water/Sewer Utility Fund Appropriations
2,735,000.00
$
2,735,000.00
$
1,938,272.05
$
33,169.87
$
738,558.08
$
25,000.00
$
Cash Disbursements
1,938,272.05
$
1,938,272.05
$
APPROPRIATIONS
YEAR ENDED DECEMBER 31, 2022
BOROUGH OF SURF CITY
WATER/SEWER UTILITY OPERATING FUND
STATEMENT OF EXPENDITURES - REGULATORY BASIS
The accompanying Notes to Financial Statements are an integral part of this statement.
26
EXHIBIT E
BALANCE
BALANCE
DECEMBER 31,
DECEMBER 31,
Reference
2022
2021
Land
E-1
748,506.36
$
748,506.36
$
Buildings
E-1
1,017,160.67
1,017,160.67
Equipment
E-1
797,707.63
739,828.63
Motor Vehicles
E-1
3,062,894.62
3,088,894.62
Total General Fixed Assets
5,626,269.28
$
5,594,390.28
$
Investment in General Fixed Assets
E
5,626,269.28
$
5,594,390.28
$
BOROUGH OF SURF CITY
DECEMBER 31, 2022 AND 2021
REGULATORY BASIS
STATEMENTS OF GENERAL FIXED ASSETS -
GENERAL FIXED ASSETS ACCOUNT GROUP
The accompanying Notes to Financial Statements are an integral part of this statement.
27
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28
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
BOROUGH OF SURF CITY
COUNTY OF OCEAN, NEW JERSEY
29
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30
BOROUGH OF SURF CITY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Note 1. Summary of Significant Accounting Policies
Description of Financial Reporting Entity
The Borough of Surf City, County of Ocean, New Jersey (hereafter referred to as the “Borough") is
incorporated under the laws of the State of New Jersey. The financial statements of the reporting entity
include those of the Borough of Surf City only.
Component Units - GASB Statement 14, as amended by GASB Statements 39, 61, 80 & 90, establishes
criteria to be used in determining the component units, which should be included in the financial statements
of a primary government. The financial statements of the Borough are not presented in accordance with
GAAP (as discussed below). Therefore, the Borough had no component units as defined by GASB
Statement No. 14, as amended by GASB Statements 39, 61, 80,90 & 94.
Basis of Accounting, Measurement Focus and Basis of Presentation - The financial statements of the
Borough contain all funds and account groups in accordance with the “Requirements of Audit” as
promulgated by the State of New Jersey, Department of Community Affairs, Division of Local Government
Services. The principles and practices established by the Requirements of Audit are designed primarily for
determining compliance with legal provisions and budgetary restrictions and as a means of reporting on the
stewardship of public officials with respect to public funds. Generally, the financial statements are
presented using the flow of current financial resources measurement focus and modified accrual basis of
accounting with minor exceptions as mandated by these “Requirements”. In addition, the prescribed
accounting principles previously referred to differ in certain respects from accounting principles generally
accepted in the United State of America applicable to local government units. The more significant
differences are explained further in this note.
In accordance with the “Requirements”, the Borough accounts for its financial transactions through the use
of separate funds, which are described as follows:
Current Fund – This fund accounts for revenues and expenditures for governmental operations of
a general nature, including federal and state grant funds.
Trust Funds – These funds account for receipts, custodianship and disbursement of funds in
accordance with the purpose for which each reserve was created.
General Capital Fund – This fund accounts for receipt and disbursement of funds for the
acquisition of general capital facilities, other than those acquired in the Current Fund.
Utility Operating and Capital Funds – These funds accounts for utility operations that are
financed through user fees. The funds are operated on a basis similar to private business enterprises
where the intent is that the costs of providing the utility to the general public be financed through
user fees. Operations relating to the acquisition of capital facilities for utility purposes are recorded
in the Utility Capital Fund.
General Fixed Asset Account Group – The Fixed Asset Account Group of accounts is utilized to
account for property, land, buildings, and equipment that have been acquired by other funds of the
Borough.
LOSAP Fund – This fund accounts for the receipts and disbursements of the Length of Service
Awards Program Fund. This Fund is not an audited opinion unit.
31
BOROUGH OF SURF CITY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Note 1. Summary of Significant Accounting Policies (continued)
Budgets and Budgetary Accounting - The Borough must adopt an annual budget for its Current and
Utility Fund in accordance with N.J.S.A.40A:4 et seq. N.J.S.A.40A:4-5 requires the governing body to
introduce and approve the annual municipal budget no later than February 10th of each year. At
introduction, the governing body must fix the time and place for a public hearing on the budget and must
advertise the time and place at least ten days prior to the hearing in a newspaper published and circulating
in the municipality. The public hearing must not be held less than twenty-eight days after the date the
budget was introduced. After the hearing has been held, the governing body may, by majority vote, adopt
the budget or may amend the budget in accordance with N.J.S.A.40A:4-9. Amendments to adopted budgets,
if any are detailed in the statements of revenues and expenditures.
An extension of the statutory dates for introduction, approval and adoption of the municipal budget may be
granted by the Director of Local Government Services, with the permission of the Local Finance Board.
Budgets are adopted on the same basis of accounting utilized for the preparation of the Borough’s financial
statements. Once a budget is approved it may be amended after November 1, by a resolution adopted by
the governing body.
Cash, Cash Equivalents and Investments - Cash and Cash equivalents include petty cash, change funds
and cash on deposit with public depositories. All certificates of deposit are recorded as cash regardless of
the date of maturity. Under GAAP, investments are reported at fair value but under regulatory basis of
accounting, investments are stated at cost with the exception of LOSAP investments which are reported at
fair value. Therefore unrealized gains or losses on investments have not been recorded.
New Jersey municipal units are required by N.J.S.A.40A:5-14 to deposit public funds in a bank or trust
company having its place of business in the State of New Jersey and organized under the laws of the United
States or of the State of New Jersey or in the New Jersey Cash Management Fund. N.J.S.A.40A:5-15.1
provides a list of investments, which may be purchased by New Jersey municipal units. In addition, other
State statutes permit investments in obligations issued by local utilities and other state agencies.
N.J.S.A.17:9-41 et seq. establishes the requirements for the security of deposits of governmental units. The
statute requires that no governmental unit shall deposit public funds in a public depository unless such funds
are secured in accordance with the Governmental Unit Deposit Protection Act, which was enacted in 1970
to protect governmental units from a loss of funds on deposit with a failed banking institution in New Jersey.
Public depositories include State or federally chartered banks savings banks or associations located in or
having a branch office in the State of New Jersey, the deposits of which are federally insured. All public
depositories must pledge collateral, having a market value at least equal to five percent of the average daily
balance of collected public funds, to secure the deposits of Governmental Units. If a public depository
fails, the collateral it has pledged, plus the collateral of all other public depositories, is available to pay the
amount of their deposits to the Governmental Units.
The cash management plan adopted by the Borough requires it to deposit funds in public depositories
protected from loss under the provisions of the Act.
Interfunds - Interfund receivables and payables that arise from transactions between funds are recorded by
all funds affected by such transactions in the period in which the transaction is executed. Interfund
receivables in the Current Fund are recorded with offsetting reserves, which are created by charges to
operations. Income is recognized in the year the receivables are liquidated. Interfund receivables in the
other funds are not offset by reserves.
32
BOROUGH OF SURF CITY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Note 1. Summary of Significant Accounting Policies (continued)
Inventories and Supplies - The cost of inventories of supplies for all funds are recorded as expenditures
at the time individual items are purchased. The costs of inventories are not included on the various
statements of assets, liabilities, reserves and fund balance.
General Fixed Assets – Accounting for governmental fixed assets, as required by N.J.A.C.5:30-5.6, differs
in certain respects from accounting principles generally accepted in the United States of America.
In accordance with the regulations, all local units, including municipalities, must maintain a general fixed
assets reporting system that establishes and maintains a physical inventory of nonexpendable, tangible
property as defined and limited by the U.S. Office of Management and Budget Circular A-87 (Attachment
B, Section 19), except that the useful life of such property is at least five years. The Borough has adopted
a capitalization threshold of $5,000.00, the maximum amount allowed by the Circular. Generally, assets
are valued at historical cost; however, assets acquired prior to December 31, 1985 are valued at actual
historical cost or estimated historical cost. In some instances, assets are valued at the assessed valuation of
the property at the time of acquisition, which approximates fair value. No depreciation of general fixed
assets is recorded. Donated general fixed assets are recorded at their acquisition value as of the date of the
transaction. Interest costs relative to the acquisition of general fixed assets are recorded as expenditures
when paid. Public domain ("infrastructure") general fixed assets consisting of certain improvements such
as roads, bridges, curbs and gutters, streets and sidewalks and drainage systems are not capitalized.
Expenditures for construction in progress are recorded in the capital funds until such time as the
construction is completed and put into operation. The Borough is required to maintain a subsidiary ledger
detailing fixed assets records to control additions, retirements, and transfers of fixed assets. In addition, a
statement of general fixed assets, reflecting the activity for the year, must be included in the Borough's
basic financial statements.
The regulations require that general fixed assets, whether constructed or acquired through purchase, grant
or gift be included in the aforementioned inventory. In addition, property management standards must be
maintained that includes accurate records indicating asset description, source, ownership, acquisition cost
and date, the percentage of federal participation (if any), and the location, use, and condition of the asset.
Periodically, physical inventories must be taken and reconciled with these records. All fixed assets must
be adequately controlled to safeguard against loss, damage, or theft.
Utility Fixed Assets – Property and equipment purchases by a utility fund are recorded in the utility capital
account at cost and are adjusted for disposition. The amounts shown do not represent replacement cost or
current value. The reserve for amortization and deferred reserve for amortization in the utility capital fund
represent the cost of the utility fixed assets reduced by the outstanding balances of bonds, loans, notes, or
other borrowings that are attributable to the acquisition, construction or improvement of those assets.
Foreclosed property – Foreclosed Property or “Property Acquired for Taxes” is recorded in the Current
Fund at the assessed valuation when such property was acquired and is fully reserved. Ordinarily it is the
intention of the Borough to resell foreclosed property in order to recover all or a portion of the delinquent
taxes or assessments and to return the property to a taxpaying basis. For this reason, the value of foreclosed
property has not been included in the General Fixed Assets Account Group. If such property is converted
to a municipal use, it will be recorded in the General Fixed Assets Account Group.
Deferred Charges – The recognition of certain expenditures is deferred to future periods. These
expenditures or deferred charges are generally overexpenditures of legally adopted budget appropriations
33
BOROUGH OF SURF CITY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Note 1. Summary of Significant Accounting Policies (continued)
or emergency appropriations made in accordance with N.J.S.A.40A:4-46 et seq. Deferred charges are
subsequently raised as items of appropriation in budgets of succeeding years.
Fund Balance – Fund Balance included in the Current and Utility Operating Fund represent the amount
available for anticipation as revenue in future year’s budgets, with certain restrictions.
Revenues – are recorded when received in cash except for certain amounts, which are due from other
governmental units. Revenue from Federal and State grants are realized when anticipated as such in the
Borough’s budget. Receivables for property taxes are recorded with offsetting reserves on the statement of
assets, liabilities, reserves and fund balance of the Borough’s Current Fund; accordingly, such amounts are
not recorded as revenue until collected. Other amounts that are due the Borough, which are susceptible to
accrual are also recorded as receivables with offsetting reserves and recorded as revenues when received.
Utility Revenues – Utility charges are billed quarterly based upon a flat service charge and if applicable,
an excess consumption or usage charge. Revenues from these sources are recognized on a cash basis.
Receivables that are susceptible to accrual are recorded with offsetting reserves on the balance sheet of the
Boroughs utility operating fund.
Property Tax Revenues – are collected in quarterly installments due February 1, May 1, August 1 and
November 1. The amount of tax levied includes not only the amount required in support of the Borough’s
annual budget, but also the amounts required in support of the budgets of the County of Ocean, Long Beach
Island Consolidated School District and Southern Regional School District. Unpaid property taxes are
subject to tax sale in accordance with statutes.
County Taxes – The municipality is responsible for levying, collecting and remitting County taxes for the
County of Ocean. Operations is charged for the amount due the County for the year, based upon the ratables
required to be certified to the County Board of Taxation by January 10th of the current year. In addition,
operations is charged for the County share of Added and Omitted Taxes certified to the County Board of
Taxation by October 10th of the current year and due to be paid to the County by February 15th of the
following year.
School Taxes – The municipality is responsible for levying, collecting and remitting school taxes for the
Long Beach Island Consolidated School District and Southern Regional School District. Operations are
charged for the full amount required to be raised from taxation to operate the local and regional school
district July 1 to June 30.
Deferred School Taxes – School taxes raised in advance in the Current Fund for a school fiscal year (July
I to June 30) which remain unpaid at December 31 of the calendar year levied may be deferred to fund
balance to the extent of not more than 50% of the annual levy providing no requisition has been made by
the school district for such amount.
Reserve for Uncollected Taxes – The inclusion of the “Reserve for Uncollected Taxes” appropriation in
the Borough’s annual budget protects the Borough from taxes not paid currently. The Reserve, the
minimum amount of which is determined on the percentage of collections experienced in the immediate
preceding year, with certain exceptions, is required to provide assurance that cash collected in the current
year will provide sufficient cash flow to meet expected obligations.
34
BOROUGH OF SURF CITY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Note 1. Summary of Significant Accounting Policies (continued)
Expenditures – are recorded on the “budgetary” basis of accounting. Generally, expenditures are recorded
when an amount is encumbered through the issuance of a numerically controlled purchase order or when a
contract is executed as required by Technical Accounting Directive No. 85-1. When an expenditure is paid,
the amount encumbered is simultaneously liquidated in its original amount.
Encumbrances are offset by an account entitled reserve for encumbrances. The reserve is classified as a
cash liability under New Jersey municipal accounting. At December 31, this reserve represents the portion
of appropriation reserves that has been encumbered and is subject to the same statutory provisions as
appropriation reserves. Appropriations for interest payments on outstanding general capital bonds and notes
are provided on the cash basis. Appropriations for interest payments on outstanding utility capital bonds
and notes are provided on the accrual basis.
Appropriation Reserves – Appropriation reserves covering unexpended appropriation balances are
automatically created at year-end and recorded as liabilities, except for amounts, which may be cancelled
by the governing body. Appropriation reserves and reserve for encumbrances at current year end are
available until December 31st of the succeeding year to meet specific claims, commitments or contracts
incurred during the preceding year. Any unspent balances at this time are lapsed appropriation reserves
and recorded as income.
Long-Term Debt - Long-Term Debt relative to the acquisition of capital assets, is recorded as a liability
in the General and Utility Capital Fund. Where an improvement is a “local improvement”, i.e. assessable
upon completion, long-term debt associated with that portion of the cost of the improvement to be funded
by assessments is transferred to the Trust Fund upon the confirmation of the assessments or when the
improvement is fully and permanently funded.
Compensated Absences – Expenditures relating to obligations for unused vested accumulated vacation
and sick leave are not recorded until paid; however, municipalities may establish and budget reserve funds
subject to NJSA 40A:4-39 for the future payment of compensated absences.
Recent Accounting Pronouncements – The Governmental Accounting Standards Board (GASB) is the
accepted standard-setting body for establishing governmental accounting and financial reporting principles.
GASB adopts accounting statements to be used by governmental units when reporting financial position
and results of operations in accordance with accounting principles generally accepted in the United States
of America (GAAP). The municipalities in the State of New Jersey do not prepare their financial statements
in accordance with GAAP and thus do not comply with all of the GASB pronouncements.
Accounting Pronouncements Adopted in Current Year
The following GASB Statements became effective for the fiscal year ended December 31, 2022:
x
Statement No. 87, Leases.
x
Statement No. 93, Replacement of Interbank Offered Rates.
x
Statement No. 97, Certain Component Unit Criteria, and Accounting and Financial Reporting for
Internal Revenue Code Section 457 Deferred Compensation Plans – an amendment of GASB
Statements No. 14 and No. 84 and a supersession of GASB Statement No. 32. Requirements of this
pronouncement related to paragraphs 4 and 5 were implemented in the prior year.
Management has determined that the implementation of these Statements did not have a significant impact
on the Borough’s financial statements.
35
BOROUGH OF SURF CITY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Note 1. Summary of Significant Accounting Policies (continued)
Accounting Pronouncements Effective in Future Reporting Periods
x
Statement No. 96, Subscription-Based Information Technology Arrangements. The requirements
of this Statement are effective for fiscal years beginning after June 15, 2022.
x
Statement No. 100, Accounting Changes and Error Corrections – an amendment of GASB
Statement No. 62. The requirements of this Statement are effective for fiscal years beginning after
June 15, 2023.
x
Statement No. 101, Compensated Absences. The requirements of this Statement are effective for
fiscal years beginning after December 15, 2023.
Management has not yet determined the impact these Statements will have on the Borough’s financial
statements.
Note 2. Deposits and Investments
The Borough is governed by the deposit and investment limitations of New Jersey state law.
Deposits
Custodial Credit Risk Related to Deposits - Custodial credit risk is the risk that, in the event of a bank
failure, the Borough’s deposits may not be returned. Although the Borough does not have a formal policy
regarding custodial credit risk, NJSA 17:9-41 et seq. requires that the governmental units shall deposit
public funds in public depositories protected from loss under the provisions of the Governmental Unit
Deposit Protection Act (GUDPA). GUDPA is a supplemental insurance program set forth by the New
Jersey Legislature to protect the deposits of local governmental agencies. The program is administered by
the Commissioner of the New Jersey Department of Banking and Insurance. Under the Act, the first
$250,000 of governmental deposits in each insured depository is protected by FDIC. Public funds owned
by the Borough in excess of FDIC insured amounts are protected by GUDPA. However, GUDPA does not
protect intermingled trust funds such as salary withholdings, bail funds or funds that may pass to the
Borough relative to the happening of a future condition. Such funds are shown as Uninsured and
Uncollateralized in the schedule below.
36
BOROUGH OF SURF CITY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Note 2. Deposits and Investments (continued)
As of December 31, 2022, the Borough’s bank balance of $14,987,855.76 was insured or collateralized as
follows:
Investments
Under the regulatory basis of accounting, investments are measured at cost in the Borough’s financial
statements. However, had the financial statements been prepared in accordance with generally accepted
accounting principles (GAAP), investments would be reported at fair value (except for fully benefit-
responsive investment contracts, which would be reported at contract value). Contract value is the relevant
measure for the portion of the Length of Service Awards Program (LOSAP) Plan attributable to fully
benefit-responsive investment contracts because contract value is the amount participants normally would
receive if they were to initiate permitted transactions under the terms of the LOSAP Plan.
Investments at Fair Value – The fair value measurements of investments are required to be reported based
on the hierarchy established by GAAP. Under GAAP, investments are required to be categorized based on
the fair value of inputs of Levels 1, 2 and 3. Under Level 1 inputs, investments are required to be
categorized based on quoted market prices in active markets for identical investments. Level 2 inputs are
based primarily on using observable measurement criteria, including quoted market prices of similar
investments in active and inactive markets and other observable corroborated factors. Level 3 inputs are
assets measured at fair value on a recurring basis using significant unobservable measurement criteria based
on the best information available. As of December 31, 2022 the Borough had investments held at Level 2
or 3.
Following is a description of the valuation methodologies used for investments measured at fair value.
Money Market Funds: Valued at the quoted NAV of shares held by the Borough at year-end.
Mutual Funds: Valued at quoted market prices which represent the net asset value (“NAV”) shares held
by the Borough at year-end.
9.26.26 pg 7 not
The Borough’s fair value, hierarchy level and maturities of its investments at December 31, 2022 was as
follows:
Insured under FDIC and GUDPA
14,560,484.56
$
NJ Cash Management Fund
137,679.91
Uninsured and Uncollateralized
427,371.20
14,987,855.76
$
Carrying
Value
Level 1
Total
Investment Type
Mutual Funds
691,704.07
$
691,704.07
$
691,704.07
$
Money Market
29,081.57
29,081.57
29,081.57
720,785.64
$
720,785.64
$
720,785.64
$
Fund
Trust Fund - LOSAP
720,785.64
$
720,785.64
$
720,785.64
$
720,785.64
$
720,785.64
$
720,785.64
$
Fair Value as of December 31,
2022
37
BOROUGH OF SURF CITY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Note 2. Deposits and Investments (continued)
Investments at Contract Value - The Borough held a fully benefit-responsive investment contract with the
Lincoln Financial Group (Lincoln) totaling $323,302.67 as of December 31, 2022. Lincoln maintains the
contributions in the group fixed annuity contracts (fixed accounts). The accounts are credited with earnings
on the underlying investments and charged for participant withdrawals and administrative expenses. The
traditional investment contracts held by the Borough are guaranteed investment contracts. The contract
issuer is contractually obligated to repay the principal and interest at a specified interest rates that are
guaranteed to the LOSAP Plan. The Borough’s ability to receive amounts due in accordance with the fully
benefit-responsive investment contracts is dependent on the contract issuer’s ability to meet its financial
obligations. The fixed accounts continue in-force until they are terminated by Lincoln or the LOSAP Plan
and do not define a maturity date.
The total Trust Fund LOSAP value held by the Borough at December 31, 2022 was as follows:
Custodial credit risk related to Investments - This is the risk that in the event of the failure of the
counterparty (e.g., broker-dealer) to a transaction, the Borough will not be able to recover the value of its
investment or collateral securities that are in the possession of another party. Other than the rules and
regulations promulgated by N.J.S.A. 40A:5-15.1, the Borough has no investment policy to limit exposure
to custodial credit risk.
Interest rate risk - This is the risk that changes in interest rates will adversely affect the fair value of an
investment. Generally, the longer the maturity of an investment, the greater the sensitivity of its fair value
to changes in market interest rates. Other than the rules and regulations promulgated by N.J.S.A. 40A:5-
15.1, the Borough does not have a formal investment policy that limits investment maturities as a means of
managing its exposure to fair value losses arising from increasing interest rates.
Credit risk - Credit risk is the risk that an issuer to an investment will not fulfill its obligation to the holder
of the investment. This is measured by assignment of a rating by a nationally recognized rating organization.
U.S. Government securities or obligations explicitly guaranteed by the U.S. government are not considered
to have credit risk exposure.
Concentration of Credit Risk – Concentration of credit risk is the risk of loss attributed to the magnitude of
a government’s investment in a single issuer. Other than the rules and regulations promulgated by N.J.S.A.
40A; 5-15.1, the Borough’s investment policies place no limit in the amount the Borough may invest in any
one issuer. More than 5% of the Borough’s investments are in money market funds and fixed account
investments. These investments represent 100% of the Borough’s total investments.
Trust Fund - LOSAP (Fair Value)
720,785.64
$
Trust Fund - LOSAP (Contract Value)
323,302.67
Total Trust Fund - LOSAP
1,044,088.31
$
38
BOROUGH OF SURF CITY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Note 3. Property Taxes
The following is a three-year comparison of certain statistical information relative to property taxes and
property tax collections for the current and previous two years.
Comparison Schedule of Tax Rates
2022
2021
2020
Tax Rate
0.980
$
0.902
$
0.873
$
Apportionment of Tax Rate:
Municipal
0.239
0.239
0.239
County
0.406
0.381
0.377
Local School
0.045
0.044
0.044
Regional School
0.290
0.238
0.213
Assessed Valuation
Year
Amount
2022
1,992,808,604.00
$
2021
1,970,216,404.00
2020
1,946,547,104.00
Comparison of Tax Levies and Collections
Cash
Percentage Of
Year
Tax Levy
Collections
Collection
2022
19,739,031.45
$
19,586,639.91
$
99.22%
2021
17,086,731.38
16,951,067.20
99.20%
2020
16,904,325.66
16,779,309.64
99.26%
Delinquent Taxes and Tax Title Liens
Tax Title
Delinquent
Total
Percentage Of
Year
Liens
Taxes
Delinquent
Tax Levy
2022
1,044.95
$
137,013.35
$
138,058.30
$
0.70%
2021
998.89
95,422.21
96,421.10
0.56%
2020
915.47
95,029.21
95,944.68
0.57%
39
BOROUGH OF SURF CITY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Note 3. Property Taxes (continued):
The last tax sale was held on October 20, 2017. There was no tax sale held in 2022.
Note 4. Property Acquired By Tax Title Lien Liquidation
The value of properties acquired by liquidation of tax title liens based on the last assessed valuation of such
properties as of December 31, was as follows:
Note 5. Water/Sewer Utility Service Charges
The following is a three-year comparison of water/sewer utility charges (rents) and collections for the
current and previous two years.
Year
Number
2022
1
2021
1
2020
1
Number of Tax Title Liens
Year
Amount
2022
4,725.00
$
2021
4,725.00
2020
4,725.00
Cash
Percentage Of
Year
Beginning Balance
Billings
Total
Collections
Collection
2022
48,713.14
$
2,149,595.78
$
2,198,308.92
$
2,163,884.72
$
98.43%
2021
35,800.00
2,149,972.56
2,185,772.56
2,137,059.82
97.77%
2020
28,237.30
2,015,977.18
2,044,214.48
2,008,414.08
98.24%
40
BOROUGH OF SURF CITY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Note 6. Fund Balances Appropriated
The following schedule details the amount of fund balances available at the end of the current year and four
previous years and the amounts utilized in the subsequent year’s budgets:
Note 7. Disaggregated Receivable and Payable Balances
There are no significant components of receivable and payable balances reported in the financial statements.
Note 8. Interfund Receivables, Payables and Transfers
The following interfund balances were recorded in the various statements of assets liabilities, reserves and
fund balances at December 31, 2022:
The interfund receivables and payables above predominately resulted from payment made by certain funds
on behalf of other funds. All interfund balances are expected to be repaid within one year.
Interfund transfers for the year ended December 31, 2022 are as follows:
Utilized in
Percentage
Balance
Budget of
of Fund
Year
December 31,
Succeeding Year
Balance Used
Current Fund:
2022
5,599,339.40
$
2,000,000.00
$
35.72%
2021
5,125,651.21
1,672,500.00
32.63%
2020
4,691,266.04
1,550,000.00
33.04%
Utility Operating Fund:
2022
2,131,014.02
$
1,000,000.00
$
46.93%
2021
1,760,308.66
980,000.00
55.67%
2020
1,305,861.37
980,000.00
75.05%
Interfund
Interfund
Fund
Receivable
Payable
Current Fund
1,663.00
$
86,866.45
$
State and Federal Grant Fund
28,603.77
-
Animal Control Trust
-
162.29
Trust Other Fund
58,275.33
-
Capital Fund
-
1,500.71
Utility Operating Fund
-
61,892.31
Utility Capital Fund
61,892.31
12.65
150,434.41
$
150,434.41
$
Fund
Transfers In
Transfers Out
Current Fund
1,129,338.12
$
1,351,932.40
$
Animal Control Trust
-
402.06
Trust Other Fund
48,795.37
64,332.40
Capital Fund
901,457.95
1,070,785.73
Utility Operating Fund
372.29
1,096.76
Utility Capital Fund
408,957.91
372.29
2,488,921.64
$
2,488,921.64
$
41
BOROUGH OF SURF CITY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Note 9. Fixed Assets
The following is a summary of changes in the General Fixed Assets Account Group for the year ended
December 31, 2022.
Note 10. Pension Obligations
A. Public Employees’ Retirement System (PERS)
Plan Description - The State of New Jersey, Public Employees' Retirement System (PERS) is a cost-
sharing multiple-employer defined benefit pension plan administered by the State of New Jersey, Division
of Pensions and Benefits (the Division). For additional information about PERS, please refer to Division's
Annual
Comprehensive
Financial
Report
(ACFR)
which
can
be
found
at
http://www.state.nj.us/treasury/pensions/annual-reports.shtml.
The vesting and benefit provisions are set by N.J.S.A. 43:15A. PERS provides retirement, death and
disability benefits. All benefits vest after ten years of service.
The following represents the membership tiers for PERS:
Tier
Definition
1
Members who were enrolled prior to July 1, 2007
2
Members who were eligible to enroll on or after July 1, 2007 and prior to November 2, 2008
3
Members who were eligible to enroll on or after November 2, 2008 and prior to May 22, 2010
4
Members who were eligible to enroll on or after May 22, 2010 and prior to June 28, 2011
5
Members who were eligible to enroll on or after June 28, 2011
Service retirement benefits of 1/55th of final average salary for each year of service credit is available to
tiers 1 and 2 members upon reaching age 60 and to tier 3 members upon reaching age 62. Service retirement
benefits of 1/60th of final average salary for each year of service credit is available to tier 4 members upon
reaching age 62 and tier 5 members upon reaching age 65. Early retirement benefits are available to tiers 1
and 2 members before reaching age 60, tiers 3 and 4 with 25 or more years of service credit before age 62
and tier 5 with 30 or more years of service credit before age 65. Benefits are reduced by a fraction of a
percent for each month that a member retires prior to the age at which a member can receive full early
retirement benefits in accordance with their respective tier. Tier 1 members can receive an unreduced
benefit from age 55 to age 60 if they have at least 25 years of service. Deferred retirement is available to
members who have at least 10 years of service credit and have not reached the service retirement age for
the respective tier.
Balance
Balance
December 31,
December 31,
2021
Additions
Deletions
2022
Land
748,506.36
$
-
$
-
$
748,506.36
$
Buildings
1,017,160.67
-
-
1,017,160.67
Equipment
739,828.63
65,479.60
-
805,308.23
Motor Vehicles
3,088,894.62
-
33,600.00
3,055,294.62
5,594,390.28
$
65,479.60
$
33,600.00
$
5,626,269.88
$
42
BOROUGH OF SURF CITY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Note 10. Pension Obligations (continued)
A. Public Employees’ Retirement System (PERS) (continued
Basis of Presentation - The schedules of employer and nonemployer allocations and the schedules of
pension amounts by employer and nonemployer (collectively, the Schedules) present amounts that are
considered elements of the financial statements of PERS or its participating employers. Accordingly, they
do not purport to be a complete presentation of the financial position or changes in financial position of
PERS or the participating employers. The accompanying Schedules were prepared in accordance with U.S.
generally accepted accounting principles. Such preparation requires management of PERS to make a
number of estimates and assumptions relating to the reported amounts. Due to the inherent nature of these
estimates, actual results could differ from those estimates.
Contributions - The contribution policy for PERS is set by N.J.S.A. 43:15A and requires contributions by
active members and contributing employers. State legislation has modified the amount that is contributed
by the State. The State's pension contribution is based on an actuarially determined amount, which includes
the employer portion of the normal cost and an amortization of the unfunded accrued liability. Funding for
noncontributory group insurance benefits is based on actual claims paid. For the fiscal year 2022, the State's
pension contribution was less than the actuarial determined amount. The local employers' contribution
amounts are based on an actuarially determined rate, which includes the normal cost and unfunded accrued
liability. Chapter 19, P.L. 2009 provided an option for local employers of PERS to contribute 50% of the
normal and accrued liability contribution amounts certified for payments due in State fiscal year 2009. Such
employers will be credited with the full payment and any such amounts will not be included in their
unfunded liability. The actuaries will determine the unfunded liability of those retirement systems, by
employer, for the reduced normal and accrued liability contributions provided under this law. This unfunded
liability will be paid by the employer in level annual payments over a period of 15 years beginning with the
payments due in the fiscal year ended June 30, 2012 and will be adjusted by the rate of return on the actuarial
value of assets. For the year ended December 31, 2022, the Borough’s contractually required contribution
to PERS plan was $144,318.
Components of Net Pension Liability - At December 31, 2022, the Borough’s proportionate share of the
PERS net pension liability was $1,727,101. The net pension liability was measured as of June 30, 2022.
The total pension liability used to calculate the net pension liability was determined using update procedures
to roll forward the total pension liability from an actuarial valuation as of July 1, 2021, which was rolled
forward to June 30, 2022. The Borough’s proportion of the net pension liability was based on the Borough’s
actual contributions to the plan relative to the total of all participating employers’ contributions for the year
ended June 30, 2022. The Borough’s proportion measured as of June 30, 2022, was 0.01144429% which
was an increase of 0.0007239% from its proportion measured as of June 30, 2021.
43
BOROUGH OF SURF CITY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Note 10. Pension Obligations (continued)
A. Public Employees’ Retirement System (PERS) (continued
Pension Expense/(Credit) and Deferred Outflows/Inflows of Resources - At December 31, 2022, the
Borough’s proportionate share of the PERS expense/(credit), calculated by the plan as of the June 30, 2022
measurement date is (214,464). This expense/(credit) is not recognized by the Borough because of the
regulatory basis of accounting as described in Note 1, but as previously mentioned the Borough contributed
$144,318 to the plan in 2022.
At December 31, 2022, the Borough reported deferred outflows of resources and deferred inflows of
resources related to PERS from the following sources:
12/31/2022
12/30/2021
Actuarial valuation date (including roll forward)
June 30, 2022
June 30, 2021
Deferred Outflows of Resources
268,872
$
170,776
$
Deferred Inflows of Resources
789,784
1,507,582
Net Pension Liability
1,727,101
1,269,989
Borough's portion of the Plan's total Net Pension Liability
0.01144%
0.01072%
Balances at December 31, 2022 and December 31, 2021
Deferred Outflows
Deferred Inflows
of Resources
of Resources
Differences between Expected
and Actual Experience
12,465
$
10,993
$
Changes of Assumptions
5,351
258,615
Net Difference between Projected
and Actual Earnings on Pension
Plan Investments
71,483
-
Changes in Proportion and Differences
between Borough Contributions and
Proportionate Share of Contributions
179,573
520,176
268,872
$
789,784
$
44
BOROUGH OF SURF CITY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Note 10. Pension Obligations (continued)
A. Public Employees’ Retirement System (PERS) (continued)
The Borough will amortize the above sources of deferred outflows and inflows related to PERS over the
following number of years:
Deferred
Deferred
Outflow of
Inflow of
Resources
Resources
Differences between Expected
and Actual Experience
Year of Pension Plan Deferral:
June 30, 2017
5.48
-
June 30, 2018
-
5.63
June 30, 2019
5.21
-
June 30, 2020
5.16
-
June 30, 2021
-
5.13
June 30, 2022
-
5.04
Changes of Assumptions
Year of Pension Plan Deferral:
June 30, 2017
-
5.48
June 30, 2018
-
5.63
June 30, 2019
-
5.21
June 30, 2020
-
5.16
June 30, 2021
5.13
-
June 30, 2022
-
5.04
Deferred
Deferred
Outflow of
Inflow of
Resources
Resources
Net Difference between Projected
and Actual Earnings on Pension
Plan Investments
Year of Pension Plan Deferral:
June 30, 2018
-
5.00
June 30, 2019
5.00
-
June 30, 2020
5.00
-
June 30, 2021
-
5.00
June 30, 2022
5.00
-
Changes in Proportion and Differences
between Contributions and
Proportionate Share of Contributions
Year of Pension Plan Deferral:
June 30, 2017
5.48
5.48
June 30, 2018
5.63
5.63
June 30, 2019
5.21
5.21
June 30, 2020
5.16
5.16
June 30, 2021
5.13
5.13
June 30, 2022
5.04
5.04
45
BOROUGH OF SURF CITY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Note 10. Pension Obligations (continued)
A. Public Employees’ Retirement System (PERS) (continued)
The following is a summary of the deferred outflows of resources and deferred inflows of resources related
to PERS that will be recognized in future periods:
Special Funding Situation – Under N.J.S.A. 43:15A-15, local participating employers are responsible for
their own contributions based on actuarially determined amounts, except where legislation was passed
which legally obligated the State if certain circumstances occurred. The legislation which legally obligates
the State, are Chapter 366, P.L. 2001 and Chapter 133, P.L. 2001.
The amounts contributed on behalf of the local participating employers under this legislation is considered
to be a special funding situation as defined by GASB Statement No. 68 and the State is treated as a non-
employer contributing entity. Since the local participating employers do not contribute under this legislation
directly to the plan (except for employer specific financed amounts), there is no net pension liability to
report in the financial statements of the local participating employers related to this legislation. At
December 31, 2022, the State’s proportionate share of the PERS expense, associated with the Borough,
calculated by the plan as of the June 30, 2022 measurement date was $0.00.
Actuarial Assumptions - The total pension asset/(liability) as of the measurement date was determined by
using an actuarial valuation as noted in the table below, with update procedures used to roll forward the
total pension liability to the measurement date. The actuarial valuations used the following actuarial
assumptions:
Year Ending
December 31,
Amount
2023
(216,270)
$
2024
(143,598.00)
2025
(104,930.00)
2026
12,182.00
2027
(68,296.00)
(520,912)
$
46
BOROUGH OF SURF CITY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Note 10. Pension Obligations (continued)
A. Public Employees’ Retirement System (PERS) (continued)
Pre-retirement mortality rates were based on the Pub-2010 General Below-Median Income Employee
Mortality Table with an 82.2% adjustment for males and 101.4% adjustment for females, and with future
improvement from the base year of 2010 on a generational basis. Post-retirement mortality rates were based
on the Pub-2010 General Below-Median Income Healthy Retiree mortality table with a 91.4% adjustment
for males and 99.7% adjustment for females, and with future improvement from the base year of 2010 on
a generational basis. Disability retirement rates used to value disabled retirees were based on the Pub-2010
Non-Safety Disabled Retiree mortality table with a 127.7% adjustment for males and 117.2% adjustment
for females, and with future improvement from the base year of 2010 on a generational basis. Mortality
improvement is based on Scale MP-2021.
The actuarial assumptions used in the July 1, 2021 valuation were based on the results of an actuarial
experience study for the period July 1, 2018 to June 30, 2021.
Long-Term Expected Rate of Return - In accordance with State statute, the long-term expected rate of
return on plan investments (7.00% at June 30, 2022) is determined by the State Treasurer, after consultation
with the Directors of the Division of Investments and Division of Pensions and Benefits, the board of
trustees and the actuaries. The long-term expected rate of return was determined using a building block
method in which best-estimate ranges of expected future real rates of return (expected returns, net of
pension plan investment expense and inflation) are developed for each major asset class. These ranges are
combined to produce the long-term expected rate of return by weighting the expected future real rates of
return by the target asset allocation percentage and by adding expected inflation. Best estimates of
arithmetic rates of return for each major asset class included in PERS’s target asset allocation as of June
30, 2022 are summarized in the following table:
Inflation:
Price
2.75%
Wage
3.25%
Salary Increases:
2.75 - 6.55%
Based on Years of Service
Investment Rate of Return
7.00%
Mortality Rate Table
Pub-2010 General Below-Median Income Employee mortality table
PERS
with fully generational mortality improvement projections
from the central year using Scale MP-2021
Period of Actuarial Experience
Study upon which Actuarial
Assumptions were Based
July 1, 2018 - June 30, 2021
47
BOROUGH OF SURF CITY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Note 10. Pension Obligations (continued)
A. Public Employees’ Retirement System (PERS) (continued)
Discount Rate - The discount rate used to measure the total pension liability was 7.00% as of June 30,
2022. The projection of cash flows used to determine the discount rate assumed that contributions from
plan members will be made at the current member contribution rates and that contributions from employers
and the nonemployer contributing entity will be based on 100% of the actuarially determined contributions
for the State employer and 100% of actuarially determined contributions for the local employers. Based on
those assumptions, the plan’s fiduciary net position was projected to be available to make projected future
benefit payments of current plan members. Therefore, the long-term expected rate of return on plan
investments was applied to all projected benefit payments to determine the total pension liability.
Sensitivity of the Borough’s proportionate share of the Net Pension Liability to Changes in the
Discount Rate - The following presents the Borough’s proportionate share of the net pension liability
calculated using the discount rate as disclosed above, as well as what the Borough’s proportionate share of
the net pension liability would be if it were calculated using a discount rate that is 1-percentage-point lower
(6.00%) or 1-percentage-point higher (8.00%) than the current rate:
Long-Term
Target
Expected Real
Asset Class
Allocation
Rate of Return
U.S. Equity
27.00%
8.12%
Non-U.S. Developed Markets Equity
13.50%
8.38%
Emerging Markets Equity
5.50%
10.33%
Private Equity
13.00%
11.80%
Real Estate
8.00%
11.19%
Real Assets
3.00%
7.60%
High Yield
4.00%
4.95%
Private Credit
8.00%
8.10%
Investment Grade Credit
7.00%
3.38%
Cash Equivalents
4.00%
1.75%
U.S. Treasuries
4.00%
1.75%
Risk Mitigation Strategies
3.00%
4.91%
100.00%
1%
Current
1%
Decrease
Discount Rate
Increase
(6.00%)
(7.00%)
(8.00%)
Borough's Proportionate Share
of the Net Pension Liability
2,237,610
$
1,727,101
$
1,319,712
$
48
BOROUGH OF SURF CITY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Note 10. Pension Obligations (continued)
B. Police and Firemen’s Retirement System (PFRS)
Plan Description – The State of New Jersey, Police and Firemen’s Retirement System (PFRS) is a cost-
sharing multiple-employer defined benefit pension plan administered by the State of New Jersey, Division
of Pensions and Benefits (the Division). For additional information about PFRS, please refer to the
Division’s
Annual
Comprehensive
Financial
Report
(ACFR)
which
can
be
found
at
http://www.state.nj.us/treasury/pensions/annual-reports.shtml.
The vesting and benefit provisions are set by N.J.S.A. 43:16A. PFRS provides retirement as well as death
and disability benefits. All benefits vest after ten years of service, except disability benefits which vest after
four years of service.
The following represents the membership tiers for PFRS:
Tier
Definition
1
Members who were enrolled prior to May 22, 2010.
2
Members who were eligible to enroll on or after May 22, 2010 and prior to June 28, 2011
3
Members who were eligible to enroll on or after June 28, 2011
Service retirement benefits are available at age 55 and are generally determined to be 2% of final
compensation for each year of creditable service, as defined, up to 30 years plus 1% for each year of service
in excess of 30 years. Members may seek special retirement after achieving 25 years of creditable service,
in which benefits would equal 65% (tiers 1 and 2 members) and 60% (tier 3 members) of final compensation
plus 1 % for each year if creditable service over 25 years but not to exceed 30 years. Members may elect
deferred retirement benefits after achieving ten years of service, in which case benefits would begin at age
55 equal to 2% of final compensation for each year of service.
Basis of Presentation - The schedule of employer and nonemployer allocations and the schedule of pension
amounts by employer and nonemployer (collectively, the Schedules) present amounts that are considered
elements of the financial statements of PFRS, its participating employers or the State as a nonemployer
contributing entity. Accordingly, they do not purport to be a complete presentation of the financial position
or changes in financial position of PFRS, the participating employers, or the State. The accompanying
Schedules were prepared in accordance with U.S. generally accepted accounting principles. Such
preparation requires management of PFRS to make a number of estimates and assumptions relating to the
reported amounts. Due to the inherent nature of these estimates, actual results could differ from those
estimates.
Contributions - The contribution policy for PFRS is set by N.J.S.A. 43:16A and requires contributions by
active members and contributing employers. State legislation has modified the amount that is contributed
by the State. The State's contribution amount is based on an actuarially determined rate which includes the
normal cost and unfunded accrued liability. For fiscal year 2021, the State contributed an amount less than
the actuarially determined amount. The Local employers’ contribution amounts are based on an actuarially
determined rate which includes the normal cost and unfunded accrued liability. Chapter 19, P.L. 2009
provided an option for local employers of PFRS to contribute 50% of the normal and accrued liability
contribution amounts certified for payments due in State fiscal year 2009. Such employers will be credited
with the full payment and any such amounts will not be included in their unfunded liability. The actuaries
will determine the unfunded liability of those retirement systems, by employer, for the reduced normal and
accrued liability contributions provided under this law.
49
BOROUGH OF SURF CITY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Note 10. Pension Obligations (continued)
B. Police and Firemen’s Retirement System (PFRS) (continued)
This unfunded liability will be paid by the employer in level annual payments over a period of 15 years
beginning with the payments due in the fiscal year ended June 30, 2012 and will be adjusted by the rate of
return on the actuarial value of assets. For the year ended December 31, 2022, the Borough’s contractually
required contributions to PFRS plan was $406,614.
Net Pension Liability and Pension Expense - At December 31, 2021 the Borough’s proportionate share
of the PFRS net pension liability was $3,578,668. The net pension liability was measured as of June 30,
2022. The total pension liability used to calculate the net pension liability was determined using update
procedures to roll forward the total pension liability from an actuarial valuation as of July 1, 2021, to the
measurement date of June 30, 2022. The Borough’s proportion of the net pension liability was based on the
Borough’s actual contributions to the plan relative to the total of all participating employers’ contributions
for the year ended June 30, 2022. The Borough’s proportion measured as of June 30, 2022, was
0.0126469%, which was an increase of 0.002664414% from its proportion measured as of June 30, 2021.
Pension Expense/(Credit) and Deferred Outflows/Inflows of Resources – At December 31, 2022, the
Borough’s proportionate share of the PFRS expense/(credit), calculated by the plan as of the June 30, 2022
measurement date was (113,758). This expense/(credit) is not recognized by the Borough because of the
regulatory basis of accounting as described in Note 1, but as previously mentioned the Borough contributed
$406,614 to the plan in 2022.
At December 31, 2022, the Borough had deferred outflows of resources and deferred inflows of resources
related to PFRS from the following sources:
12/31/2022
12/30/2021
Actuarial valuation date (including roll forward)
June 30, 2022
June 30, 2021
Deferred Outflows of Resources
1,136,605
$
517,779
$
Deferred Inflows of Resources
704,923
1,867,259
Net Pension Liability
3,578,668
2,090,438
Borough's portion of the Plan's total net pension Liability
0.03126%
0.02860%
Balances at December 31, 2022 and December 31, 2021
50
BOROUGH OF SURF CITY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Note 10. Pension Obligations (continued)
B. Police and Firemen’s Retirement System (PFRS) (continued)
The Borough will amortize the above sources of deferred outflows and inflows related to PFRS over the
following number of years:
Deferred Outflows
Deferred Inflows
of Resources
of Resources
Differences between Expected
and Actual Experience
161,980
$
219,242
$
Changes of Assumptions
9,808
450,484
Net Difference between Projected
and Actual Earnings on Pension
Plan Investments
327,701
-
Changes in Proportion and Differences
between Borough Contributions and
Proportionate Share of Contributions
637,116
35,197
1,136,605
$
704,923
$
Deferred
Deferred
Outflow of
Inflow of
Resources
Resources
Differences between Expected
and Actual Experience
Year of Pension Plan Deferral:
June 30, 2017
5.59
-
June 30, 2018
5.73
-
June 30, 2019
-
5.92
June 30, 2020
5.90
-
June 30, 2021
-
6.17
June 30, 2022
6.22
-
Changes of Assumptions
Year of Pension Plan Deferral:
June 30, 2017
-
5.59
June 30, 2018
-
5.73
June 30, 2019
-
5.92
June 30, 2020
-
5.90
June 30, 2021
-
6.22
51
BOROUGH OF SURF CITY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Note 10. Pension Obligations (continued)
B. Police and Firemen’s Retirement System (PFRS) (continued)
The following is a summary of the deferred outflows of resources and deferred inflows of resources related
to PFRS that will be recognized in future periods:
Special Funding Situation – Under N.J.S.A. 43:16A-15, local participating employers are responsible for
their own contributions based on actuarially determined amounts, except where legislation was passed
which legally obligated the State if certain circumstances occurred. The legislation which legally obligates
the state is as follows: Chapter 8, P.L. 2000, Chapter 318, P.L. 2001, Chapter 86, P.L. 2001, Chapter 511,
P.L, 1991, Chapter 109, P.L. 1979, Chapter 247, P.L. 1993 and Chapter 201, P.L. 2001.
Deferred
Deferred
Outflow of
Inflow of
Resources
Resources
Net Difference between Projected
and Actual Earnings on Pension
Plan Investments
Year of Pension Plan Deferral:
June 30, 2018
-
5.00
June 30, 2019
5.00
-
June 30, 2020
5.00
-
June 30, 2021
-
5.00
June 30, 2022
5.00
-
Changes in Proportion and Differences
between Contributions and
Proportionate Share of Contributions
Year of Pension Plan Deferral:
June 30, 2017
5.59
5.59
June 30, 2018
5.73
5.73
June 30, 2019
5.92
5.92
June 30, 2020
5.90
5.90
June 30, 2021
6.17
6.17
June 30, 2022
6.22
6.22
Year Ending
December 31,
Amount
2023
(58,606)
$
2024
5,998
2025
11,419
2026
347,996
2027
122,578
Thereafter
2,297
431,682
$
52
BOROUGH OF SURF CITY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Note 10. Pension Obligations (continued)
B. Police and Firemen’s Retirement System (PFRS) (continued)
The amounts contributed on behalf of the local participating employers under this legislation is considered
to be a special funding situation as defined by GASB Statement No. 68 and the State is treated as a non-
employer contributing entity. Since the local participating employers do not contribute under this legislation
directly to the plan (except for employer specific financed amounts), there is no net pension liability to
report in the financial statements of the local participating employers related to this legislation.
Additionally, the State’s proportionate share of the PFRS net pension liability attributable to the Borough
is $636,898 as of December 31, 2022. The net pension liability was measured as of June 30, 2022. The total
pension liability used to calculate the net pension liability was determined using update procedures to roll
forward the total pension liability from an actuarial valuation as of July 1, 2021, to the measurement date
of June 30, 2022. The State’s proportion of the net pension liability associated with the Borough was based
on a projection of the Borough’s long-term share of contributions to the pension plan relative to the
projected contributions of all participating members, actuarially determined. The State’s proportion
measured as of June 30, 2022 was 0.03126469%, which was an increase of 0.0026644% from its proportion
measured as of June 30, 2021, which is the same proportion as the Borough’s. At December 31, 2022, the
Borough’s and the State of New Jersey’s proportionate share of the PFRS net pension liability were as
follows:
At December 31, 2022, the State’s proportionate share of the PFRS expense, associated with the Borough,
calculated by the plan as of the June 30, 2022 measurement date was $73,481.
Actuarial Assumptions - The total pension asset/(liability) as of the measurement date was determined
by using an actuarial valuation as noted in the table below, with update procedures used to roll forward
the total pension liability to the measurement date. The actuarial valuations used the following actuarial
assumptions:
Borough's Proportionate Share of Net Pension Liability
3,578,668
$
State of New Jersey's Proportionate Share of Net Pension
Liability Associated with the Borough
636,898
4,215,566
$
53
BOROUGH OF SURF CITY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Note 10. Pension Obligations (continued)
B. Police and Firemen’s Retirement System (PFRS) (continued)
Pre-retirement mortality rates were based on the Pub-2010 Safety Employee mortality table with a 105.6%
adjustment for males and 102.5% adjustment for females, and with future improvement from the base year
of 2010 on a generational basis. For healthy annuitants, post-retirement mortality rates were based on the
Pub-2010 Safety Retiree Below-Median Income Weighted mortality table with a 96.7% adjustment for
males and 96.0% adjustment for females, and with future improvement from the base year of 2010 on a
generational basis. For beneficiaries, the Pub-2010 General Retiree Below-Median Income Weighted
mortality table was used, unadjusted, and with future improvement from the base year of 2010 on a
generational basis. Disability rates were based on the Pub-2010 Safety Disabled Retiree mortality table with
a 152.0% adjustment for males and 109.3% adjustment for females, and with future improvement from the
base year of 2010 on a generational basis. Mortality improvement is based on Scale MP-2020.
The actuarial assumptions used in the July 1, 2022 valuation were based on the results of an actuarial
experience study for the period July 1, 2018 to June 30, 2021.
Long-Term Expected Rate of Return - In accordance with State statute, the long-term expected rate of
return on plan investments (7.00% at June 30, 2021) is determined by the State Treasurer, after consultation
with the Directors of the Division of Investments and Division of Pensions and Benefits, the board of
trustees and the actuaries. The long-term expected rate of return was determined using a building block
method in which best-estimate ranges of expected future real rates of return (expected returns, net of
pension plan investment expense and inflation) are developed for each major asset class. These ranges are
combined to produce the long-term expected rate of return by weighting the expected future real rates of
return by the target asset allocation percentage and by adding expected inflation. Best estimates of
arithmetic rates of return for each major asset class included in PFRS’s target asset allocation as of June
30, 2022 are summarized in the following table:
Inflation
Price
2.75%
Wage
3.25%
Salary Increases:
Through
All future years
3.25 - 16.25%
Based on Years of Service
Investment Rate of Return
7.00%
Mortality Rate Table
PubS-2010 amount-weighted mortality table
PFRS
using Scale MP-2021
Period of Actuarial Experience
Study upon which Actuarial
Assumptions were Based
July 1, 2018 - June 30, 2021
54
BOROUGH OF SURF CITY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Note 10. Pension Obligations (continued)
B. Police and Firemen’s Retirement System (PFRS) (continued)
Discount Rate - The discount rate used to measure the total pension liability was 7.00% as of June 30,
2022. The projection of cash flows used to determine the discount rate assumed that contributions from
plan members will be made at the current member contribution rates and that contributions from employers
and the nonemployer contributing entity will be based on 100% of the actuarially determined contributions
for the State employer and 100% of actuarially determined contributions for local employers. Based on
those assumptions, the plan’s fiduciary net position was projected to be available to make all projected
future benefit payments of current plan members. Therefore, the long-term expected rate of return on plan
investments was applied to all projected benefit payments to determine the total pension liability.
Sensitivity of the Borough’s proportionate share of the Net Pension Liability to Changes in the
Discount Rate - The following presents the Borough’s proportionate share of the net pension liability
calculated using the discount rate as disclosed above, as well as what the Borough’s proportionate share of
the net pension liability would be if it were calculated using a discount rate that is 1-percentage-point lower
(6.00%) or 1-percentage-point higher (8.00%) than the current rate:
Long-Term
Target
Expected Real
Asset Class
Allocation
Rate of Return
U.S. Equity
27.00%
8.12%
Non-U.S. Developed Markets Equity
13.50%
8.38%
Emerging Markets Equity
5.50%
10.33%
Private Equity
13.00%
11.80%
Real Estate
8.00%
11.19%
Real Assets
3.00%
7.60%
High Yield
4.00%
4.95%
Private Credit
8.00%
8.10%
Investment Grade Credit
7.00%
3.38%
Cash Equivalents
4.00%
1.75%
U.S. Treasuries
4.00%
1.75%
Risk Mitigation Strategies
3.00%
4.91%
100.00%
55
BOROUGH OF SURF CITY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Note 10. Pension Obligations (continued)
B. Police and Firemen’s Retirement System (PFRS) (continued)
Related Party Investments - The Division of Pensions and Benefits does not invest in securities issued by
the Borough.
Note 11. Municipal Debt
The following schedule represents the Borough’s summary of debt, as filed in the Borough’s Annual Debt
Statement required by the Local Bond Law of New Jersey for the current and two previous years:
1%
Current
1%
Decrease
Discount Rate
Increase
(6.00%)
(7.00%)
(8.00%)
Borough's Proportionate Share
of the Net Pension Liability
4,910,319
$
3,578,668
$
10,817,033
$
State of New Jersey's Proportionate
Share of Net Pension Liability
associated with the Borough
873,893
636,898
1,925,115
5,784,212
$
4,215,566
$
12,742,148
$
2022
2021
2020
Authorized but not issued:
General:
Bonds, Notes and Loans
3,318,160.86
$
2,477,129.51
$
2,117,063.61
$
Utility:
Bonds, Notes and Loans
743,252.40
1,043,750.00
735,000.00
Total Authorized But Not Issued
4,061,413.26
3,520,879.51
2,852,063.61
Total Gross Debt
4,061,413.26
$
3,520,879.51
$
2,852,063.61
$
56
BOROUGH OF SURF CITY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Note 11. Municipal Debt (continued):
Summary of Statutory Debt Condition - Annual Debt Statement
The following schedule is a summary of the previous schedule and is prepared in accordance with the
required method of setting up the Annual Debt Statement:
Net Debt $2,080,380.28 divided by the average Equalized Valuation Basis per N.J.S.A 40A:2-2 as
amended, $1,873,938,433.00, equals 0.111%. New Jersey statute 40A:2-6, as amended, limits the debt of
a Municipality to 3.5% of the last three preceding year’s average equalized valuations of real estate,
including improvements and the assessed valuation of Class II Railroad Property. The remaining borrowing
power in dollars at December 31, 2022 is calculated as follows:
Deductions:
General:
Funds on Hand For Payment of Bonds and Notes:
Reserve for Debt Service
36,683.33
$
36,683.33
$
36,683.33
$
Utility:
Self Liquidating Debt
743,252.40
1,043,750.00
735,000.00
Total Deductions
779,935.73
1,080,433.33
771,683.33
Total Net Debt
3,281,477.53
$
2,440,446.18
$
2,080,380.28
$
Gross Debt
Deductions
Net Debt
General Debt
3,318,160.86
$
36,683.33
$
3,281,477.53
$
Utility Debt
743,252.40
743,252.40
-
4,061,413.26
$
779,935.73
$
3,281,477.53
$
Borrowing Power Under N.J.S. 40A:2-6 as Amended
3 1/2% of Equalized Valuation Basis (Municipal)
70,297,679.91
$
Net Debt
3,281,477.53
Remaining Borrowing Power
67,016,202.38
$
57
BOROUGH OF SURF CITY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Note 11. Municipal Debt (continued)
General Debt
A. Serial Bonds Payable
The Borough had no serial bonds payable outstanding in the General Capital Fund at December 31, 2022.
B. Bond Anticipation Notes Payable – Short Term Debt
The Borough had no bond anticipation notes outstanding in the General Capital Fund at December 31,
2022.
C. Bonds and Notes Authorized But Not Issued
As of December 31, 2022, the Borough had $3,318,160.86 in various General Capital bonds and notes
authorized but not issued.
Water/Sewer Utility Debt
A. Serial Bonds Payable
The Borough had no serial bonds payable outstanding in the Water/Sewer Utility Capital Fund at December
31, 2022.
B. Bond Anticipation Notes Payable – Short Term Debt
The Borough had no bond anticipation notes outstanding in the Utility Capital Fund at December 31, 2022.
C. Bonds and Notes Authorized But Not Issued
As of December 31, 2022 the Borough had $743,252.40 in various Utility bonds and notes authorized but
not issued.
Self-Liquidating Utility Calculation per N.J.S.A. 40A:2-46
Cash Receipts From Fees, Rents
or Other Charges for the Year
3,341,698.44
$
Deductions:
Operating and Maintenance Costs
2,500,000.00
$
Total Deductions
2,500,000.00
Excess/(Deficit) in Revenue
841,698.44
$
*If Excess in Revenues all Utility Debt is Deducted
58
BOROUGH OF SURF CITY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Note 12. Deferred School Taxes
School taxes have been raised and the liability deferred by statutes. The balance of unpaid local and regional
school taxes levied, amount deferred and the amount reported as a liability (payable) at December 31, are
as follows:
Note 13. Accrued Sick, Vacation and Compensation Time
As discussed in Note 1 and in accordance with accounting principles prescribed by the State of New Jersey,
the cash basis of accounting is followed for recording the Borough’s liability related to unused vacation,
sick pay and compensation time. The Borough permits certain employees within limits to accumulate
unused vacation, sick pay and compensation time, which may be taken as time off or paid at a later date at
an agreed upon rate. In accordance with New Jersey accounting principles, this unused accumulated
absences amount is not reported as a liability in the accompanying financial statements. It is estimated that
accrued benefits for compensated absences are valued at $101,249.53 at December 31, 2022.
The Borough has established a Trust Fund in accordance with NJSA 40A:4-39 to set aside funds for future
payments of compensated absences. As of December 31, 2022, the Borough has reserved in the Other Trust
Fund $106,676.82 to fund compensated absences in accordance with NJSA 40A:4-39.
Local Taxes
2022
2021
Total Balance of Local Tax
225,321.25
$
430,698.00
$
Deferred Taxes
171,899.27
171,899.27
Local Tax Payable
53,421.98
$
258,798.73
$
Regional Tax
Total Balance of Regional Tax
2,885,927.39
$
2,345,601.39
$
Deferred Taxes
396,208.48
396,208.48
Regional Tax Payable
2,489,718.91
$
1,949,392.91
$
Balance, December 31,
59
BOROUGH OF SURF CITY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Note 14. Risk Management
The Borough is exposed to various risks of loss related to torts; theft of, damage to and destruction of assets;
errors and omissions; injuries to employees; and natural disasters.
Joint Insurance Pool
The Borough is a member of the Ocean County Municipal Joint Insurance Fund. The Fund provides the
Borough with the following primary coverage and limits:
Crime
$50,000
Commercial General Liability
$300,000
The following “excess” coverage and limits are provided to the Fund’s member local units by their
membership in the Municipal Excess Liability Joint Insurance Fund (MEL):
Worker’s Compensation
$2,000,000
Commercial General Liability
$300,000
Auto Liability
$300,000
Crime
$1,000,000
Contributions to the Funds are payable in two installments and are based on actuarial assumptions
determined by the Funds’ actuaries. The Fund publishes its own financial report for the year ended
December 31, 2022 which can be obtained on the Fund’s website.
Note 15. Contingencies
Grantor Agencies
The Borough receives financial assistance from the State of New Jersey and the U.S. government in the
form of grants. Entitlement to the funds is generally conditional upon compliance with terms and conditions
of the grant agreements and applicable regulations, including the expenditure of the funds for eligible
purposes. Substantially all grants, entitlements and cost reimbursements are subject to financial and
compliance audits by grantors. As a result of these audits, costs previously reimbursed could be disallowed
and require repayment to the grantor agency. As of December 31, 2022, the Borough estimates that no
material liabilities will result from such audits.
Litigation
The Borough is a defendant in several legal proceedings that are in various stages of litigation. It is believed
that the outcome, or exposure to the Borough, from such litigation is either unknown or potential losses, if
any, would not be material to the financial statements.
Tax Appeals
Losses arising from tax appeals are recognized at the time a decision is rendered by an administrative or
judicial body; however, municipalities may establish reserves transferred from tax collections or by budget
appropriation for future payments of tax appeal losses. There are no significant pending tax appeals as of
December 31, 2022.
60
BOROUGH OF SURF CITY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Note 16. Length of Service Awards Program
The Borough’s length of service awards program (“LOSAP”) is reported in the Borough’s trust fund
Statement of Assets, Liabilities, Reserves and Fund Balance - Regulatory Basis. The LOSAP provides tax
deferred income benefits to active volunteer firefighters and emergency medical personnel.
The tax deferred income benefits for the active volunteer firefighters and emergency medical personnel
serving the residents the of the Borough come from contributions made solely by the governing body of the
Borough, on behalf of those volunteers who meet the criteria of a plan created by that governing body.
Participants should refer to the Plan agreement for a more complete description of the Plan’s provisions.
Contributions - If an active member meets the year of active service requirement, a length of service
awards program must provide a benefit between the minimum contribution of $100 and a maximum
contribution of $1,150.00 per year. While the maximum amount is established by statute, it is subject to
periodic increases that are related to the consumer price index (N.J.S.A. 40A:14-185(f)). The Division of
Local Government Services of the State of New Jersey will issue the permitted maximum annually. The
Borough elected to contribute between $0.00 and $1,150.00 for the year ended December 31, 2022 per
eligible volunteer, into the Plan, depending on how many years the volunteer has served. During the year
ended December 31, 2022, the Borough contributed a total of $47,606.00 to the plan. Participants direct
the investment of the contributions into various investment options offered by the Plan. The Borough has
no authorization to direct investment contributions on behalf of eligible volunteers nor has the ability to
purchase or sell investment options offered by the Plan. The types of investment options, and the
administering of such investments, rests solely with the plan administrator.
Participant Accounts - Each participant’s account is credited with the Borough’s contribution and Plan
earnings, and charged with administrative expenses. The benefit to which a participant is entitled is the
benefit that can be provided from the participant’s vested account. The Borough has placed the amounts
deferred, including earnings, in a trust maintained by a third-party administrator for the exclusive benefit
of the plan participants and their beneficiaries. Such funds, although subject to the claims of the Borough’s
creditors until distributed as benefit payments, are not available for funding the operations of the Borough.
The funds may also be used to pay the administrative fees charged by the Plan Administrator. Lincoln
Financial Group (“Plan Administrator”), an approved Length of Service Awards Program provider, is the
administrator of the Plan. The Borough’s practical involvement in administering the Plan is essentially
limited to verifying the eligibility of each participant and remitting the funds to the Plan Administrator.
Vesting - Benefits, plus actual earnings thereon, are one hundred percent (100%) vested after five (5) years
of service.
Payment of Benefits - Upon retirement or disability, participants may select various payout options, which
include lump sum, periodic, or annuity payments. In the case of death, with certain exceptions, any amount
invested under the participant's account is paid to the beneficiary or the participant's estate. In the event of
an unforeseeable emergency, as outlined in the Plan document, a participant or a beneficiary entitled to
vested accumulated deferrals may request the local plan administrator to payout a portion of vested
accumulated deferrals. During the year ended December 31, 2022 payouts of $60,138.05 were made to
vested participants.
Forfeited Accounts – During the year ended December 31, 2022, no accounts were forfeited.
Plan Information - Additional information about the Borough’s length of service awards program can be
obtained by contacting the Plan Administrator.
61
BOROUGH OF SURF CITY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2022
Note 17. Subsequent Events
Management has reviewed and evaluated all events and transactions that occurred between December 31,
2022 and September 27, 2023, the date that the financial statements were available for issuance, for possible
disclosure and recognition in the financial statements. No significant subsequent events were noted.
62
SUPPLEMENTARY EXHIBITS
63
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64
CURRENT FUND
65
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66
EXHIBIT A-4
9,577,474.40
$
Increased By:
Miscellaneous Revenue Not Anticipated
349,468.53
$
Due from State for Exemptions
19,635.00
Taxes Receivable
19,234,252.94
Revenue Accounts Receivable
1,145,463.89
Prepaid Taxes
402,908.29
Tax Overpayments
16,562.37
Grants Receivable
39,407.45
Reserve for Grants Unappropriated
19,450.92
Due from Animal Control Fund
402.06
Due to Trust Other Fund
64,332.40
Due from General Capital Fund
1,070,785.73
ARP Grant Received
62,748.80
Various Reserves
238,805.23
22,664,223.61
32,241,698.01
Decreased By:
2022 Budget Appropriations
5,891,971.78
2021 Appropriation Reserves
89,609.84
County Taxes
8,126,118.82
Local District School Tax
1,106,657.75
Regional School Tax
5,231,529.00
Reserve for Grants Appropriated
66,010.14
Due to Trust Other Fund
42,725.65
Due to General Capital Fund
901,457.95
Due to Utility Operating Fund
407,748.80
Refund of Prior Year Revnues
11,825.84
21,875,655.57
10,366,042.44
$
Balance, December 31, 2021
Balance, December 31, 2022
YEAR ENDED DECEMBER 31, 2022
BOROUGH OF SURF CITY
COUNTY OF OCEAN, NEW JERSEY
CURRENT FUND
SCHEDULE OF CASH - COLLECTOR/TREASURER
67
EXHIBIT A-5
(667.75)
$
Increased By:
Senior Citizens' Deductions per Tax Billings
250.00
$
Veterans' Deductions per Tax Billing
19,000.00
Deductions Allowed By Collector:
Senior Citizens' & Veterans - Current Year
250.00
19,500.00
18,832.25
Decreased By:
Cash Receipts
19,635.00
19,635.00
(802.75)
$
Balance, December 31, 2022
SENIOR CITIZENS' AND VETERANS' DEDUCTIONS
YEAR ENDED DECEMBER 31, 2022
BOROUGH OF SURF CITY
CURRENT FUND
SCHEDULE OF DUE FROM/(TO) STATE OF NEW JERSEY -
Balance, December 31, 2021
68
EXHIBIT A-6
SENIOR CITIZENS'
AND VETERANS'
BALANCE
DEDUCTIONS
TRANSFER
BALANCE
DECEMBER 31,
2022
ALLOWED/
TO TAX
ADJUSTMENTS/
DECEMBER 31,
YEAR
2021
LEVY
2021
2022
(DISALLOWED)
TITLE LIENS
(CANCELLED)
2022
2021
95,422.21
$
-
$
-
$
95,422.21
$
-
$
-
$
-
$
-
$
2022
-
19,739,031.45
428,309.18
19,138,830.73
19,500.00
46.06
(15,332.13)
137,013.35
95,422.21
$
19,739,031.45
$
14,409,110.79
$
19,234,252.94
$
19,500.00
$
46.06
$
(15,332.13)
$
137,013.35
$
Analysis of Property Tax Levy
Tax Yield:
General Purpose Tax
19,652,195.46
$
Added and Omitted Taxes (N.J.S.A 54:4-63.1 et seq)
86,835.99
19,739,031.45
$
Tax Levy:
Local School Taxes
901,281.00
$
Regional School Taxes
5,771,855.00
County Taxes
8,074,427.00
$
Due To County for Added
and Omitted Taxes
86,835.99
8,161,262.99
Local Tax for Municipal
Purposes
4,765,000.00
Additional Tax Levied
139,632.46
4,904,632.46
Total
19,739,031.45
$
COLLECTIONS
CURRENT FUND
BOROUGH OF SURF CITY
YEAR ENDED DECEMBER 31, 2022
SCHEDULE OF TAXES RECEIVABLE AND ANALYSIS OF PROPERTY TAX LEVY
69
EXHIBIT A-7
998.89
$
Increased By:
Transfers From Taxes Receivable
46.06
1,044.95
$
Balance, December 31, 2021
Balance, December 31, 2022
YEAR ENDED DECEMBER 31, 2022
BOROUGH OF SURF CITY
CURRENT FUND
SCHEDULE OF TAX TITLE LIENS RECEIVABLE
70
EXHIBIT A-8
BALANCE
BALANCE
DECEMBER 31,
ACCRUED IN
DECEMBER 31,
2021
2022
COLLECTED
2022
Liquor License
-
$
1,400.00
$
1,400.00
$
-
$
Other Fees & Permits
-
27,232.00
27,232.00
-
Interest & Costs on Taxes
-
35,133.32
35,133.32
-
Municipal Court Fines & Costs
749.60
26,354.49
26,635.47
468.62
Beach Badge Fees
-
801,931.00
801,931.00
-
Energy Receipts Taxes
-
173,007.00
173,007.00
-
Uniform Construction Code Fees
-
107,801.10
107,801.10
-
749.60
$
1,172,858.91
$
1,173,139.89
$
468.62
$
Cash Receipts
1,145,463.89
$
Prior Year Prepaid Beach Badges
27,676.00
1,173,139.89
$
BOROUGH OF SURF CITY
CURRENT FUND
SCHEDULE OF REVENUE ACCOUNTS RECEIVABLE
YEAR ENDED DECEMBER 31, 2022
71
EXHIBIT A-9
BALANCE
BALANCE
DECEMBER 31,
AFTER
PAID OR
BALANCE
2021
TRANSFER
CHARGED
LAPSED
GENERAL GOVERNMENT
General Administration
Salaries & Wages
11,317.50
$
11,317.50
$
-
$
11,317.50
$
Other Expenses
11,142.12
11,142.12
1,340.75
9,801.37
Human Resources
Other Expenses
7,000.00
7,000.00
-
7,000.00
Mayor and Council
Salaries & Wages
539.00
539.00
-
539.00
Other Expenses
3,163.09
3,163.09
2,156.19
1,006.90
Municipal Clerk
Salaries & Wages
35,581.95
35,581.95
-
35,581.95
Other Expenses
6,926.51
6,926.51
681.29
6,245.22
Financial Administration
Salaries & Wages
12,252.04
12,252.04
-
12,252.04
Other Expenses
2,945.53
2,945.53
609.72
2,335.81
Audit Services
Other Expenses
3,900.00
3,900.00
3,150.00
750.00
Collection of Taxes
Salaries & Wages
12,342.05
12,342.05
-
12,342.05
Other Expenses
12,647.28
12,647.28
178.35
12,468.93
Assessment of Taxes
Salaries & Wages
5,131.76
5,131.76
-
5,131.76
Other Expenses
9,614.61
9,614.61
1,505.19
8,109.42
Legal Services
Other Expenses
11,562.50
11,562.50
651.00
10,911.50
Revision of Ordinances
Other Expenses
4,500.00
4,500.00
-
4,500.00
Engineering Services
Other Expenses
5,000.00
5,000.00
88.63
4,911.37
Review/Revision of Master Plan
Other Expenses
616.97
616.97
172.50
444.47
Municipal Court
Salaries & Wages
21,613.61
21,613.61
-
21,613.61
Other Expenses
4,190.80
4,190.80
803.93
3,386.87
Public Defender
Other Expenses
1,227.75
1,227.75
577.50
650.25
Land Use Administration:
Land Use Board
Salaries & Wages
3,980.12
3,980.12
-
3,980.12
Other Expenses
9,313.63
9,313.63
436.50
8,877.13
Code Enforcement & Administration:
Other Code Enforcement Functions
Salaries & Wages
293.95
293.95
-
293.95
Other Expenses
2,900.00
2,900.00
-
2,900.00
Zoning Officer
Salaries & Wages
294.44
294.44
-
294.44
Other Expenses
2,500.00
2,500.00
-
2,500.00
Insurance:
General Liability
10,458.00
10,458.00
-
10,458.00
Workers Compensation
7,899.33
7,899.33
-
7,899.33
Employee Group Health
227,774.59
227,774.59
100.00
227,674.59
Health Benefit Waiver
Salaries & Wages
16,666.66
16,666.66
-
16,666.66
BOROUGH OF SURF CITY
CURRENT FUND
SCHEDULE OF 2021 APPROPRIATION RESERVES
YEAR ENDED DECEMBER 31, 2022
72
EXHIBIT A-9
BALANCE
BALANCE
DECEMBER 31,
AFTER
PAID OR
BALANCE
2021
TRANSFER
CHARGED
LAPSED
BOROUGH OF SURF CITY
CURRENT FUND
SCHEDULE OF 2021 APPROPRIATION RESERVES
YEAR ENDED DECEMBER 31, 2022
Public Safety Functions:
Police Department
Salaries & Wages
43,929.34
43,929.34
-
43,929.34
Other Expenses
7,119.85
7,119.85
6,393.99
725.86
Police Dispatch/911
Other Expenses
5,219.20
5,219.20
-
5,219.20
Office of Emergency Management
Salaries & Wages
500.00
500.00
-
500.00
Other Expenses
8,711.85
8,711.85
-
8,711.85
Municipal Prosecutor's Office
Other Expenses
2,208.37
2,208.37
826.00
1,382.37
Public Work Functions:
Streets and Road Maintenance
Salaries & Wages
27,330.08
27,330.08
-
27,330.08
Other Expenses
4,547.40
4,547.40
4,347.40
200.00
Solid Waste Collection
Salaries & Wages
82,647.92
82,647.92
-
82,647.92
Other Expenses
21,399.99
21,399.99
2,135.79
19,264.20
Building and Grounds
Salaries & Wages
3,511.73
3,511.73
-
3,511.73
Other Expenses
20,126.99
20,126.99
4,029.15
16,097.84
Vehicle Maintenance (Incl. Police Vehicles)
Salaries & Wages
701.87
701.87
-
701.87
Other Expenses
44,531.59
44,531.59
12,307.82
32,223.77
Health & Human Services Functions:
Board of Health
Salaries & Wages
1,773.00
1,773.00
-
1,773.00
Other Expenses
766.00
766.00
-
766.00
Environmental Health Services
Salaries & Wages
5,000.00
5,000.00
-
5,000.00
Other Expenses
1,000.00
1,000.00
-
1,000.00
Animal Control Services
Other Expenses
1,608.00
1,608.00
1,344.00
264.00
Contributions to Social Service Agencies
Senior Citizen Center (NJS 40:48-9.4)
5,000.00
5,000.00
-
5,000.00
Health Care Facilities (NJS 44:5-2)
100.00
100.00
-
100.00
Mental Health Facilities (NJS 40:48-9.4a)
100.00
100.00
-
100.00
Recreation of Services and Programs
Salaries & Wages
5,000.00
5,000.00
-
5,000.00
Other Expenses
2,000.00
2,000.00
-
2,000.00
Maintenance of Parks
Salaries & Wages
12,501.15
12,501.15
-
12,501.15
Other Expenses - Veterans' Memorial Park
1,726.83
1,726.83
-
1,726.83
Other Expenses - Other Facilities
4,000.00
4,000.00
-
4,000.00
Beach & Boardwalk Operations
Salaries & Wages
11,567.56
11,567.56
-
11,567.56
Other Expenses
1,779.03
1,779.03
20.82
1,758.21
73
EXHIBIT A-9
BALANCE
BALANCE
DECEMBER 31,
AFTER
PAID OR
BALANCE
2021
TRANSFER
CHARGED
LAPSED
BOROUGH OF SURF CITY
CURRENT FUND
SCHEDULE OF 2021 APPROPRIATION RESERVES
YEAR ENDED DECEMBER 31, 2022
Other Common Operating Functions (Unclassified)
Celebration of Public Events
Other Expenses
905.56
905.56
-
905.56
Utility Expenses & Bulk Purchases
Electricity
14,346.18
14,346.18
524.59
13,821.59
Street Lighting
9,172.73
9,172.73
-
9,172.73
Telephone
10,543.72
10,543.72
-
10,543.72
Gas (natural or propane)
5,505.80
5,505.80
1,924.80
3,581.00
Telecommunications
1,752.49
1,752.49
226.76
1,525.73
Gasoline
29,716.22
29,716.22
3,140.77
26,575.45
Landfill/Solid Waste Disposal Costs:
Other Expenses
25,614.30
25,614.30
806.39
24,807.91
Uniform Construction Code:
Salaries & Wages
2,100.70
2,100.70
-
2,100.70
Other Expenses
36,320.65
36,320.65
218.01
36,102.64
Contingent
4,000.00
4,000.00
-
4,000.00
Statutory Expenditures:
Contribution to:
Social Security System (O.A.S.I.)
13,971.93
13,971.93
-
13,971.93
Unemployment
1,251.02
1,251.02
-
1,251.02
Defined Contribution Retirement Program
1,305.81
1,305.81
-
1,305.81
Length of Service Awards Program (L.O.S.A.P.)
Other Expenses
52,000.00
52,000.00
38,912.00
13,088.00
Recycling Tax (P.L. 2007, c. 311):
Other Expenses
1,291.99
1,291.99
-
1,291.99
Capital Improvements:
Rehabilitation of / Enhancement to Borough Property
11,847.86
11,847.86
-
11,847.86
1,013,350.50
$
1,013,350.50
$
89,609.84
$
923,740.66
$
Appropriation Reserves
982,746.47
$
Encumbrances Payable
30,604.03
1,013,350.50
$
74
EXHIBIT A-10
30,604.03
$
Increased By:
Current Appropriations
98,205.35
128,809.38
Decreased By:
Transferred To Appropriation Reserves
30,604.03
98,205.35
$
Balance, December 31, 2021
Balance, December 31, 2022
YEAR ENDED DECEMBER 31, 2022
BOROUGH OF SURF CITY
CURRENT FUND
SCHEDULE OF ENCUMBRANCES PAYABLE
75
EXHIBIT A-11
428,309.18
$
Increased By:
Prepaid Taxes Collected
402,908.29
831,217.47
Decreased By:
Applied To Taxes Receivable
428,309.18
402,908.29
$
Balance, December 31, 2021
Balance, December 31, 2022
YEAR ENDED DECEMBER 31, 2022
BOROUGH OF SURF CITY
CURRENT FUND
SCHEDULE OF PREPAID TAXES
76
EXHIBIT A-12
51,691.82
$
Increased By:
2022 Tax Levy:
County Taxes
7,109,736.00
$
County Library Taxes
699,741.00
County Open Space Taxes
264,950.00
Due To County for Added and Omitted Taxes
86,835.99
8,161,262.99
8,212,954.81
Decreased By:
Cash Disbursements
8,126,118.82
86,835.99
$
Balance, December 31, 2021
Balance, December 31, 2022
YEAR ENDED DECEMBER 31, 2022
BOROUGH OF SURF CITY
CURRENT FUND
SCHEDULE OF COUNTY TAXES PAYABLE
77
EXHIBIT A-13
School Tax Payable
258,798.73
$
School Tax Deferred
171,899.27
430,698.00
$
Increased By:
901,281.00
1,331,979.00
Decreased By:
Cash Disbursements
1,106,657.75
School Tax Payable
53,421.98
School Tax Deferred
171,899.27
225,321.25
$
Tax Payable, December 31, 2022
53,421.98
$
Tax Paid
1,106,657.75
1,160,079.73
Less:
258,798.73
Amount Charged to 2020 Operations
901,281.00
$
Balance, December 31, 2021:
BALANCE, DECEMBER 31, 2022
BOROUGH OF SURF CITY
CURRENT FUND
SCHEDULE OF LOCAL DISTRICT SCHOOL TAXES
Balance, December 31, 2022:
Levy - July 1, 2022 to June 30, 2023
Tax Payable, December 31, 2021
2019 Liability for Regional High School Tax
78
EXHIBIT A-14
School Tax Payable
1,949,392.91
$
School Tax Deferred
396,208.48
2,345,601.39
$
5,771,855.00
8,117,456.39
Cash Disbursements
5,231,529.00
School Tax Payable
2,489,718.91
School Tax Deferred
396,208.48
2,885,927.39
$
Tax Payable, December 31, 2022
2,489,718.91
$
Tax Paid
5,231,529.00
7,721,247.91
Less:
1,949,392.91
Amount Charged to 2019 Operations
5,771,855.00
$
BALANCE, DECEMBER 31, 2022
BOROUGH OF SURF CITY
CURRENT FUND
SCHEDULE OF REGIONAL SCHOOL TAXES
Tax Payable, December 31, 2021
Balance, December 31, 2021:
Increased By:
Decreased By:
Balance, December 31, 2022:
2019 Liability for Regional School Tax
Levy - July 1, 2022 to June 30, 2023
79
EXHIBIT A-15
BALANCE
BALANCE
DECEMBER 31,
DECEMBER 31,
2021
INCREASED
DECREASED
2022
Library Aid
14.00
$
-
$
-
$
14.00
$
Tax Appeal
-
77,641.20
-
77,641.20
Hurricane Expense (Special Emergency)
114,818.01
206,805.23
-
321,623.24
Prepaid Beach Badges
27,676.00
32,000.00
27,676.00
32,000.00
Reserve for Ocean County CARES Grant
187,862.99
-
-
187,862.99
330,371.00
$
316,446.43
$
27,676.00
$
619,141.43
$
2022 Budget
77,641.20
Cash Receipts
238,805.23
316,446.43
$
Anticipated as Revenue
27,676.00
$
27,676.00
$
BOROUGH OF SURF CITY
CURRENT FUND
SCHEDULE OF VARIOUS RESERVES
BALANCE DECEMBER 31, 2022
80
EXHIBIT A-16
BALANCE
REVENUE
BALANCE
AS OF
ANTICIPATED
2022
AS OF
DECEMBER 31, 2021
2022
RECEIVED
CANCELLED
DECEMBER 31, 2022
Federal Grants:
Community Development Block Grant
7,493.40
$
34,000.00
$
34,000.00
$
7,493.40
$
-
$
Total Federal Grants
7,493.40
34,000.00
34,000.00
7,493.40
-
State Grants:
Body Armor Replacement Fund
-
1,113.83
1,113.83
-
-
Recycling Tonnage Grant
-
5,407.45
5,407.45
-
-
Clean Communities
-
11,905.90
11,905.90
-
-
Total State Grants
-
18,427.18
18,427.18
-
-
7,493.40
$
52,427.18
$
52,427.18
$
7,493.40
$
-
$
Cash Receipts
39,407.45
$
Transferred From Unappropriated
13,019.73
52,427.18
$
Program
BOROUGH OF SURF CITY
FEDERAL AND STATE GRANT FUND
SCHEDULE OF GRANTS RECEIVABLE
BALANCE DECEMBER, 31, 2022
81
EXHIBIT A-17
BALANCE
TRANSFERRED
BALANCE
DECEMBER 31,
FROM
DECEMBER 31,
Program
2021
BUDGET
EXPENDED
2022
Federal Grants:
Municipal Public Access Plan Grant
7,813.50
$
-
$
-
$
7,813.50
$
Community Development Block Grant
6,189.50
34,000.00
40,189.50
-
Total Federal Grants
14,003.00
34,000.00
40,189.50
7,813.50
State Grants:
Clean Communities Program
-
11,905.90
11,905.90
-
Body Armor Replacement
2,144.93
1,113.83
3,258.76
-
Recycling Tonnage Grant
5,248.53
5,407.45
10,655.98
-
Total State Grants
7,393.46
18,427.18
25,820.64
-
21,396.46
$
52,427.18
$
66,010.14
$
7,813.50
$
Original Budget
52,427.18
$
52,427.18
$
BOROUGH OF SURF CITY
FEDERAL AND STATE GRANT FUND
SCHEDULE OF RESERVE FOR GRANT EXPENDITURES - APPROPRIATED
BALANCE DECEMBER 31, 2022
82
EXHIBIT A-18
BALANCE
BALANCE
DECEMBER 31,
CASH
REALIZED IN
DECEMBER 31,
2021
RECEIPTS
2022 BUDGET
2022
Body Armor Replacement Fund
2,453.18
$
1,954.12
$
1,113.83
$
3,293.47
$
Clean Communities Program
11,905.90
11,554.03
11,905.90
11,554.03
Recycling Tonnage Grant
-
5,942.77
-
5,942.77
14,359.08
$
19,450.92
$
13,019.73
$
20,790.27
$
Program
BOROUGH OF SURF CITY
FEDERAL AND STATE GRANT FUND
SCHEDULE OF RESERVE FOR GRANT EXPENDITURES - UNAPPROPRIATED
BALANCE DECEMBER 31, 2022
83
This page intentionally left blank
84
TRUST FUND
85
This page intentionally left blank
86
EXHIBIT B-1
ANIMAL
TRUST-
CONTROL
OTHER
785.15
$
460,869.20
$
Increased By Receipts:
Dog License Fees Collected
168.00
-
State Registration Fees
79.20
-
Due to Water/Sewer Operating Fund
-
1,109.41
Various Reserves
-
4,685,229.21
247.20
4,686,338.62
1,032.35
5,147,207.82
Decreased By Disbursements:
State Registration Fees
79.20
-
Due to Current Fund
402.06
-
Due to Water/Sewer Operating Fund
-
12.65
Various Reserves
-
4,726,959.85
481.26
4,726,972.50
551.09
$
420,235.32
$
Balance, December 31, 2021
Balance, December 31, 2022
BOROUGH OF SURF CITY
YEAR ENDED DECEMBER 31, 2022
SCHEDULE OF CASH RECEIPTS AND DISBURSEMENTS
TRUST FUND
87
EXHIBIT B-2
Balance, December 31, 2021
36,655.93
$
Increased By:
Cash Receipts in Current Fund
64,332.40
100,988.33
Decreased By:
Cash Disbursed by Current Fund
42,725.65
Balance, December 31, 2022
58,262.68
$
YEAR ENDED DECEMBER 31, 2022
BOROUGH OF SURF CITY
SCHEDULE OF DUE FROM CURRENT FUND
TRUST - OTHER FUND
88
EXHIBIT B-3
Balance, December 31, 2021
1,109.41
$
Increased By:
Cash Disbursements
12.65
1,122.06
Decreased By:
Cash Receipts
1,109.41
Balance, December 31, 2022
12.65
$
BOROUGH OF SURF CITY
SCHEDULE OF DUE (TO)/FROM WATER SEWER OPERATING FUND
TRUST - OTHER FUND
YEAR ENDED DECEMBER 31, 2022
89
EXHIBIT B-4
Balance, December 31, 2021
376.52
$
Increased By:
Statutory Excess Due To Current Fund
93.60
470.12
Decreased By:
Cash Disbursement
307.83
Balance, December 31, 2022
162.29
$
BOROUGH OF SURF CITY
YEAR ENDED DECEMBER 31, 2022
SCHEDULE OF DUE TO CURRENT FUND
TRUST - OTHER FUND
DOG LICENSE FUND
90
EXHIBIT B-5
411.63
$
Increased By:
Dog License Fees Collected
168.00
579.63
Decreased By:
Dog Fund Expenditures Paid by Current Fund
94.23
$
Statutory Excess Due Current Fund
93.60
187.83
391.80
$
Year
Amount
2021
178.80
$
2020
213.00
391.80
$
YEAR ENDED DECEMBER 31, 2022
BOROUGH OF SURF CITY
ANIMAL CONTROL FUND
SCHEDULE OF RESERVE FOR DOG FUND EXPENDITURES
Balance, December 31, 2022
Balance, December 31, 2021
91
EXHIBIT B-6
BALANCE
BALANCE
DECEMBER 31,
DECEMBER
2021
INCREASES
DECREASES
2022
Confiscated Funds Reserve
1,093.71
$
-
$
-
$
1,093.71
$
Cash Bonds & Escrowed Fees
315,250.32
379,640.31
413,865.20
281,025.43
P.O.A.A.
1,185.05
146.00
-
1,331.05
Veterans' Memorial Park
17,704.92
500.00
280.00
17,924.92
Public Defender Fund
200.00
200.00
-
400.00
Beach Wheels
2,163.50
82.00
-
2,245.50
Memorial Benches
14,914.16
20,700.00
10,600.44
25,013.72
Accumulated Absences
98,676.82
8,000.00
-
106,676.82
Payroll Deductions
22,528.16
4,255,735.40
4,266,955.06
11,308.50
Construction Inspection Fees
24,917.90
84,557.90
77,984.80
31,491.00
498,634.54
$
4,749,561.61
$
4,769,685.50
$
478,510.65
$
Cash Receipts
4,685,229.21
$
Due From Current Fund
64,332.40
4,749,561.61
$
Cash Disbursements
4,726,959.85
$
Due To Current Fund
42,725.65
4,769,685.50
$
BOROUGH OF SURF CITY
TRUST - OTHER FUND
SCHEDULE OF TRUST - OTHER RESERVES
YEAR ENDED DECEMBER 31, 2022
92
EXHIBIT B-7
1,238,293.20
$
Increased By:
47,606.00
1,285,899.20
Decreased By:
Withdrawals
60,138.05
$
Unrealized Loss on Investments
180,022.84
Accounting Charges
1,650.00
241,810.89
1,044,088.31
$
EXHIBIT B-8
1,238,293.20
$
Increased By:
Contributions
47,606.00
1,285,899.20
Decreased By:
Withdrawals
60,138.05
$
Unrealized Loss on Investments
180,022.84
Accounting Charges
1,650.00
241,810.89
1,044,088.31
$
Balance, December 31, 2022
SCHEDULE OF LOSAP RESERVE
YEAR ENDED DECEMBER 31, 2022
Balance, December 31, 2021
Balance, December 31, 2022
Balance, December 31, 2021
BOROUGH OF SURF CITY
LENGTH OF SERVICE AWARDS PROGRAM FUND ("LOSAP")
SCHEDULE OF INVESTMENTS
YEAR ENDED DECEMBER 31, 2022
93
This page intentionally left blank
94
GENERAL CAPITAL FUND
95
This page intentionally left blank
96
EXHIBIT C-2
1,418,323.41
$
Increased By:
Capital Improvement Fund
50,000.00
$
Deferred Charges Raised by Budget Appropriation
203,968.65
253,968.65
1,672,292.06
Decreased By:
Due To Current Fund
1,070,785.73
601,506.33
$
Balance, December 31, 2021
Balance, December 31, 2022
BOROUGH OF SURF CITY
YEAR ENDED DECEMBER 31, 2022
SCHEDULE OF CASH
GENERAL CAPITAL FUND
97
EXHIBIT C-3
BALANCE
DECEMBER 31,
2022
Capital Improvement Fund
860,432.50
$
Reserve for Debt Service
36,683.33
Reserve for Purchase of Lifeguard Boat
18,150.00
Reserve for Encumbrances
25,453.00
Due (From)/To Current Fund
1,500.71
Capital Fund Balance
82,452.67
Ordinance
Ordinance
Improvement Authorizations
15-04
Rehabilitation of DPW Facilities
298,358.12
18-04
Removal of Underground Storage Tank
5,520.07
18-15
Repair/Resurfacing of Various Roads
(42,500.00)
19-11
Repair/Resurfacing of Various Roads & Related Expenses
(201,020.01)
19-13
Replacement/Repair of Various Roads & Related Expenses
(85,977.06)
20-02
Road Improvement Project
(518,898.71)
21-03/13
Acquisition of Beach Equipment
(134,511.26)
21-11
Road Improvement Project
233,815.97
22-04
Road Reconstruction and Improvements
35,000.00
22-08
Acquisition of Livescan Machine
(23,953.00)
22-09
Various Capital Improvements & Equipment Acquisition
for Beach and Recreation Areas
11,000.00
601,506.33
$
BOROUGH OF SURF CITY
YEAR ENDED DECEMBER 31, 2022
SCHEDULE OF ANALYSIS OF CASH
GENERAL CAPITAL FUND
98
EXHIBIT C-4
(170,828.49)
$
Increased by:
Cash Disbursed to Current Fund
1,070,785.73
899,957.24
Decreased By:
Cash Disbursed by Current Fund
901,457.95
(1,500.71)
$
Balance, December 31, 2021
Balance, December 31, 2022
YEAR ENDED DECEMBER 31, 2022
BOROUGH OF SURF CITY
GENERAL CAPITAL FUND
SCHEDULE OF DUE FROM/(TO) CURRENT FUND
99
EXHIBIT C-5
BALANCE
BALANCE
DECEMBER 31,
DECEMBER 31,
2021
2022
21-11 Road Improvement Project
128,450.00
$
128,450.00
$
BOROUGH OF SURF CITY
GENERAL CAPITAL FUND
SCHEDULE OF GRANTS RECIEVABLE
YEAR ENDED DECEMBER 31, 2022
100
EXHIBIT C-6
BALANCE
FUNDED BY
BALANCE
UNEXPENDED
Ordinance
DECEMBER 31,
2022
BUDGET
DECEMBER 31,
IMPROVEMENT
Date
2021
AUTHORIZED
APPROPRIATION
2022
EXPENDITURES
AUTHORIZATIONS
06-15 Beach Replenishment
11/30/06
126,463.23
$
-
$
-
$
126,463.23
$
-
$
126,463.23
$
11-03 Acquisition of Trash Truck
05/11/11
32,000.00
-
-
32,000.00
-
32,000.00
13-05 Acquisition of Trash Truck
10/09/13
29,231.00
-
-
29,231.00
-
29,231.00
13-06 Acquisition of a Beach Rake
10/09/13
13,997.36
-
-
13,997.36
-
13,997.36
14-05 Acquisition of Fire Apparatus & Related Equipment
09/10/14
37,352.67
-
-
37,352.67
-
37,352.67
15-03 Replacement/Repair of Various Bulkheads
03/11/15
2,000.00
-
2,000.00
-
-
-
16-06 Reconstruction/Resurfacing of Various Streets
06/08/16
125,335.25
-
125,335.25
-
-
-
17-07 Reconstruction/Resurfacing of Various Streets
07/12/17
12,000.00
-
12,000.00
-
-
-
18-02 Acquisition of Trash Truck
03/14/18
20,000.00
-
5,883.40
14,116.60
-
14,116.60
18-04 Removal of Underground Storage Tank
03/14/18
118,750.00
-
-
118,750.00
-
118,750.00
18-15 Repair/Resurfacing of Various Roads
12/12/18
42,500.00
-
-
42,500.00
42,500.00
-
19-11 Repair/Resurfacing of Various Roads & Related Expenses
08/14/19
380,000.00
-
-
380,000.00
201,020.01
178,979.99
19-13 Replacement/Repair of Various Roads & Related Expenses
09/11/19
380,000.00
-
58,750.00
321,250.00
85,977.06
235,272.94
20-02 Road Improvement Project
04/08/20
593,750.00
-
-
593,750.00
518,898.71
74,851.29
21-03/13 Acquisition of Beach Equipment
12/13/21
142,500.00
-
-
142,500.00
142,011.26
488.74
21-11 Road Improvement Project
12/13/21
421,250.00
142,500.00
-
563,750.00
(30,000.00)
593,750.00
22-04 Road Reconstruction and Improvements
-
665,000.00
-
665,000.00
-
665,000.00
22-08 Acquisition of Livescan Machine
-
28,500.00
-
28,500.00
23,953.00
4,547.00
22-09 Various Capital Improvements & Equipment Acquisition
for Beach and Recreation Areas
12/13/21
-
209,000.00
-
209,000.00
-
209,000.00
2,477,129.51
$
1,045,000.00
$
203,968.65
$
3,318,160.86
$
984,360.04
$
2,333,800.82
$
Improvement Authorizations
YEAR ENDED DECEMBER 31, 2022
BOROUGH OF SURF CITY
GENERAL CAPITAL FUND
SCHEDULE OF DEFERRED CHARGES TO FUTURE TAXATION - UNFUNDED
Analysis of Balance
101
EXHIBIT C-7
Transferred
Transferred
Ordinance
Ordinance
2022
From
To
Improvement Authorizations
Date
Amount
Funded
Unfunded
Authorizations
Encumbrances
Expended
Encumbrances
Funded
Unfunded
06-15 Beach Replenishment
11/30/06
350,000.00
$
-
$
126,463.23
$
-
$
-
$
-
$
-
$
-
$
126,463.23
$
11-03 Acquisition of Trash Truck
05/11/11
200,000.00
-
32,000.00
-
-
-
-
-
32,000.00
13-05 Acquisition of Trash Truck
10/09/13
200,000.00
-
29,231.00
-
-
-
-
-
29,231.00
13-06 Acquisition of a Beach Rake
10/09/13
65,000.00
-
13,997.36
-
-
-
-
-
13,997.36
14-05 Acquisition of Fire Apparatus & Related Equipment
09/10/14
800,000.00
-
37,352.67
-
-
-
-
-
37,352.67
15-04 Rehabilitation of DPW Facilities
03/11/15
450,000.00
298,358.12
-
-
-
-
-
298,358.12
-
15-09 Removal of Underground Storage Tank/Monitoring
12/09/15
50,000.00
2,685.07
-
-
-
2,685.07
-
-
-
18-02 Acquisition of Trash Truck
03/14/18
200,000.00
-
14,116.60
-
-
-
-
-
14,116.60
18-04 Removal of Underground Storage Tank
03/14/18
125,000.00
6,250.00
118,750.00
-
-
729.93
-
5,520.07
118,750.00
18-15 Repair/Resurfacing of Various Roads
12/12/18
500,000.00
104,513.89
42,500.00
-
-
147,013.89
-
-
-
19-11 Repair/Resurfacing of Various Roads & Related Expenses
08/14/19
700,000.00
-
205,064.25
-
-
26,084.26
-
-
178,979.99
19-13 Replacement/Repair of Various Roads & Related Expenses
09/11/19
400,000.00
-
360,379.31
-
-
125,106.37
-
-
235,272.94
20-02 Road Improvement Project
04/08/20
625,000.00
-
556,776.09
-
-
481,924.80
-
-
74,851.29
21-03/13 Acquisition of Beach Equipment
12/13/21
150,000.00
7,500.00
488.74
-
65,479.60
65,479.60
-
7,500.00
488.74
21-11/22-03 Road Improvement Project
08/11/21
850,000.00
278,750.00
421,250.00
150,000.00
-
52,434.03
-
203,815.97
593,750.00
22-04 Road Reconstruction and Improvements
-
-
-
700,000.00
-
-
-
35,000.00
665,000.00
22-08 Acquisition of Livescan Machine
-
-
-
30,000.00
-
-
25,453.00
-
4,547.00
22-09 Various Capital Improvements & Equipment Acquisition
for Beach and Recreation Areas
12/13/21
700,000.00
-
-
220,000.00
-
-
11,000.00
209,000.00
698,057.08
$
1,958,369.25
$
1,100,000.00
$
65,479.60
$
901,457.95
$
25,453.00
$
561,194.16
$
2,333,800.82
$
Deferred Charges - Unfunded
1,045,000.00
$
Capital Improvement Fund
55,000.00
1,100,000.00
$
BOROUGH OF SURF CITY
GENERAL CAPITAL FUND
SCHEDULE OF IMPROVEMENT AUTHORIZATIONS
December 31, 2021
Balance
YEAR ENDED DECEMBER 31, 2022
December 31, 2022
Balance
102
EXHIBIT C-8
865,432.50
$
Increased By:
2022 Budget Appropriation
50,000.00
915,432.50
Decreased By:
Utilized To Finance Improvement Authorizations
55,000.00
860,432.50
$
Balance, December 31, 2022
YEAR ENDED DECEMBER 31, 2022
GENERAL CAPITAL FUND
BOROUGH OF SURF CITY
SCHEDULE OF CAPITAL IMPROVEMENT FUND
Balance, December 31, 2021
103
EXHIBIT C-9
BALANCE
BALANCE
DECEMBER 31,
DECEMBER 31,
2021
2022
Reserve for Debt Service
36,683.33
$
36,683.33
$
Reserve for Purchase of Lifeguard Boat
18,150.00
18,150.00
54,833.33
$
54,833.33
$
YEAR ENDED DECEMBER 31, 2022
GENERAL CAPITAL FUND
BOROUGH OF SURF CITY
SCHEDULE OF VARIOUS RESERVES
104
EXHIBIT C-10
BALANCE
PAID BY
BALANCE
Ordinance
DECEMBER 31,
2022
BUDGET
DECEMBER 31,
Number
Improvement Authorizations
2021
AUTHORIZATIONS
APPROPRIATION
2022
06-15
Beach Replenishment
126,463.23
$
-
$
-
$
126,463.23
$
11-03
Acquisition of Trash Truck
32,000.00
-
-
32,000.00
13-05
Acquisition of Trash Truck
29,231.00
-
-
29,231.00
13-06
Acquisition of a Beach Rake
13,997.36
-
-
13,997.36
15-03
Acquisition of Fire Apparatus & Related Equipment
37,352.67
-
-
37,352.67
15-04
Replacement/Repair of Various Bulkheads
2,000.00
-
2,000.00
-
16-06
Reconstruction/Resurfacing of Various Streets
125,335.25
-
125,335.25
-
17-07
Reconstruction/Resurfacing of Various Streets
12,000.00
-
12,000.00
-
18-02
Acquisition of Trash Truck
20,000.00
-
5,883.40
14,116.60
18-04
Removal of Underground Storage Tank
118,750.00
-
-
118,750.00
18-15
Repair/Resurfacing of Various Roads
42,500.00
-
-
42,500.00
19-11
Repair/Resurfacing of Various Roads & Related Expenses
380,000.00
-
-
380,000.00
19-13
Replacement/Repair of Various Roads & Related Expense
380,000.00
-
58,750.00
321,250.00
20-02
Road Improvement Project
593,750.00
-
-
593,750.00
21-03/13
Acquisition of Beach Equipment
142,500.00
-
-
142,500.00
21-11
Road Improvement Project
421,250.00
142,500.00
-
563,750.00
22-04
Road Reconstruction and Improvements
-
665,000.00
-
665,000.00
22-08
Acquisition of Livescan Machine
-
28,500.00
-
28,500.00
22-09
Various Capital Improvements & Equipment Acquisition
for Beach and Recreation Areas
-
209,000.00
-
209,000.00
2,477,129.51
$
1,045,000.00
$
203,968.65
$
3,318,160.86
$
BOROUGH OF SURF CITY
YEAR ENDED DECEMBER 31, 2022
SCHEDULE OF BONDS AND NOTES AUTHORIZED BUT NOT ISSUED
GENERAL CAPITAL FUND
105
This page intentionally left blank
106
WATER/SEWER UTILITY FUND
107
This page intentionally left blank
108
EXHIBIT D-4
2,539,790.04
$
46,999.49
$
Increased By Receipts:
Miscellaneous Revenue Not Anticipated
122,254.23
$
-
$
Fire Hydrant Service
118,400.00
-
Water/Sewer Rents Receivable
2,144,834.59
-
Prepaid Rents
16,553.52
-
Capital Improvement Fund
-
25,000.00
Budget Appropriations - Deferred Charges
-
175,000.00
Due To/From Current Fund
-
407,748.80
Due From Utility Capital Fund
372.29
-
Due To/From Utility Operating Fund
-
1,209.11
2,402,414.63
608,957.91
4,942,204.67
655,957.40
Decreased By Disbursements:
2022 Budget Appropriations
1,938,272.05
-
2021 Appropriation Reserves
13,031.93
-
Due From Trust - Other Fund
1,096.76
-
Due To Utility Capital Fund
1,209.11
-
Due To Utility Operating Fund
-
372.29
Improvement Authorization
-
60,492.24
1,953,609.85
60,864.53
2,988,594.82
$
595,092.87
$
BOROUGH OF SURF CITY
Balance, December 31, 2021
Balance, December 31, 2022
YEAR ENDED DECEMBER 31, 2022
SCHEDULE OF CASH - TREASURER
WATER/SEWER UTILITY OPERATING FUND
OPERATING
CAPITAL
109
EXHIBIT D-5
BALANCE
DECEMBER 31, 2022
Capital Improvement Fund
528,315.51
$
Due From Utility Operating Fund
(61,892.31)
Fund Balance
7,476.47
Ordinance
Number
Improvement Authorizations
18-16
Improvements to Water/Sewer System
(36,906.22)
21-15
Rehabilitation of Borough Water Tower
158,099.42
595,092.87
$
BOROUGH OF SURF CITY
WATER/SEWER UTILITY CAPITAL FUND
SCHEDULE OF ANALYSIS OF WATER/SEWER UTILITY CAPITAL FUND CASH
YEAR ENDED DECEMBER 31, 2022
110
EXHIBIT D-6
48,713.14
$
Increased By:
2022 Billings
2,149,595.78
2,198,308.92
Decreased By:
Cash Collections
2,144,834.59
$
Prepaid Rents Applied
19,050.13
2,163,884.72
34,424.20
$
Balance, December 31, 2021
Balance, December 31, 2022
BOROUGH OF SURF CITY
YEAR ENDED DECEMBER 31, 2022
SCHEDULE OF WATER/SEWER RENTS
WATER/SEWER UTILITY OPERATING FUND
111
EXHIBIT D-7
Balance,
Balance,
December 31,
December 31,
2021
2022
Water Fund:
Land
5,623.38
$
5,623.38
$
Springs and Wells
1,170,538.06
1,170,538.06
Pumping Station & Equipment
169,915.01
169,915.01
Distribution Mains & Accessories
921,335.92
921,335.92
Meters & Accessories
96,475.00
96,475.00
Garage & Storage Building
72,384.87
72,384.87
Tower, Standpipe & Storage Tanks
2,321,164.07
2,321,164.07
Fire Hydrants
49,213.51
49,213.51
Trucks & Other Equipment
181,239.47
181,239.47
Water Plant & Equipment
578,742.57
578,742.57
Office Facilities
13,938.13
13,938.13
Computer System
8,973.23
8,973.23
Wells
863,592.15
863,592.15
Sewer Fund:
Collection System
1,600,045.63
1,600,045.63
Landscaping
2,774.20
2,774.20
Meters & Accessories
6,573.45
6,573.45
Trucks & Other Equipment
201,415.82
201,415.82
Garage & Storage Building
74,202.32
74,202.32
Office Facilities
13,938.12
13,938.12
Computer System
8,503.25
8,503.25
8,360,588.16
$
8,360,588.16
$
BOROUGH OF SURF CITY
SCHEDULE OF FIXED CAPITAL
YEAR ENDED DECEMBER 31, 2022
112
EXHIBIT D-8
BALANCE
BALANCE
Ordinance
DECEMBER 31,
DECEMBER 31,
Number
DATE
AMOUNT
2021
2022
18-16
Improvements to Water/Sewer System
12/12/18
600,000.00
$
370,887.98
$
370,887.98
$
21-15
Rehabilitation of Borough Water Tower
12/13/21
825,000.00
825,000.00
825,000.00
1,195,887.98
$
1,195,887.98
$
Purpose
ORDINANCE
BOROUGH OF SURF CITY
WATER/SEWER UTILITY CAPITAL FUND
SCHEDULE OF FIXED CAPITAL AUTHORIZED AND UNCOMPLETED
YEAR ENDED DECEMBER 31, 2022
113
EXHIBIT D-9
BALANCE
BALANCE
DECEMBER 31,
AFTER
BALANCE
2021
TRANSFERS
EXPENDED
LAPSED
Operating:
Salaries and Wages
217,431.25
$
217,431.25
$
-
$
217,431.25
$
Other Expenses
360,548.40
360,548.40
13,031.93
347,516.47
Capital Improvements:
Capital Outlay
85,000.00
85,000.00
-
85,000.00
Statutory Expenditures:
Contribution To:
Social Security System (O.A.S.I.)
22,520.74
22,520.74
-
22,520.74
Defined Contribution Retirement Plan
379.25
379.25
-
379.25
Unemployment Compensation Insurance
3,318.70
3,318.70
-
3,318.70
689,198.34
$
689,198.34
$
13,031.93
$
676,166.41
$
Appropriation Reserves
683,755.21
$
Encumbrances Payable
5,443.13
689,198.34
$
Appropriation
BOROUGH OF SURF CITY
WATER/SEWER UTILITY OPERATING FUND
SCHEDULE OF 2021 APPROPRIATION RESERVES
YEAR ENDED DECEMBER 31, 2022
114
EXHIBIT D-10
5,443.13
$
33,169.87
38,613.00
Transferred To Appropriation Reserves
5,443.13
33,169.87
$
Increased By:
Current Appropriations
Decreased By:
Balance, December 31, 2022
BOROUGH OF SURF CITY
WATER/SEWER UTILITY OPERATING FUND
SCHEDULE OF ENCUMBRANCES PAYABLE
YEAR ENDED DECEMBER 31, 2022
Balance, December 31, 2021
115
EXHIBIT D-11
19,050.13
$
Increased By:
Cash Receipts
16,553.52
35,603.65
Decreased By:
Applied To Rents Receivable
19,050.13
16,553.52
$
Balance, December 31, 2022
BOROUGH OF SURF CITY
WATER/SEWER UTILITY OPERATING FUND
SCHEDULE OF PREPAID RENTS
YEAR ENDED DECEMBER 31, 2022
Balance, December 31, 2021
116
EXHIBIT D-12
7,644.37
$
BOROUGH OF SURF CITY
WATER/SEWER UTILITY OPERATING FUND
SCHEDULE OF ACCOUNTS PAYABLE
YEAR ENDED DECEMBER 31, 2022
Balance, December 31, 2022 and 2021
117
EXHIBIT D-13
62,748.80
$
Cash Disbursements
62,748.80
-
$
Decreased By:
Balance, December 31, 2022
BOROUGH OF SURF CITY
WATER/SEWER UTILITY OPERATING FUND
SCHEDULE OF RESERVE FOR AMERICAN RECOVERY ACT
YEAR ENDED DECEMBER 31, 2022
Balance, December 31, 2021
118
EXHIBIT D-14
19.67
$
Interest Earned in Water/Sewer Utility Capital Fund
1,209.11
$
61,035.82
62,244.93
62,264.60
Cash Receipts
372.29
61,892.31
$
Balance, December 31, 2021
BOROUGH OF SURF CITY
WATER/SEWER UTILITY OPERATING FUND
SCHEDULE OF DUE FROM/(TO) WATER/SEWER UTILITY CAPITAL FUND
YEAR ENDED DECEMBER 31, 2022
Increased By:
Decreased By:
Balance, December 31, 2022
Cash Disbursed by Utility Operating
119
EXHIBIT D-15
345,000.00
$
62,748.80
407,748.80
Cash Receipts
407,748.80
-
$
Balance, December 31, 2022
Balance, December 31, 2021
BOROUGH OF SURF CITY
WATER/SEWER UTILITY OPERATING FUND
SCHEDULE OF DUE FROM/(TO) CURRENT FUND
YEAR ENDED DECEMBER 31, 2022
Increased By:
ARP Grant Received in Current Fund
Decreased By:
120
EXHIBIT D-16
Ordinance
Paid or
Number
Purpose
Date
Amount
Funded
Unfunded
Charged
Funded
Unfunded
18-16
Improvements to Water/Sewer System
12/12/18
600,000.00
$
-
$
99,937.84
$
51,844.06
$
-
$
48,093.78
$
21-15
Rehabilitation of Borough Water Tower
12/13/21
825,000.00
41,250.00
783,750.00
8,648.18
158,099.42
658,252.40
41,250.00
$
883,687.84
$
60,492.24
$
158,099.42
$
706,346.18
$
Ordinance
BOROUGH OF SURF CITY
WATER/SEWER UTILITY CAPITAL FUND
SCHEDULE OF IMPROVEMENT AUTHORIZATIONS
YEAR ENDED DECEMBER 31, 2022
December 31, 2022
Balance
Balance
December 31, 2021
121
EXHIBIT D-17
Balance, December 31, 2021
503,315.51
$
Increased By:
2022 Budget Appropriations
25,000.00
528,315.51
$
Balance, December 31, 2022
BOROUGH OF SURF CITY
YEAR ENDED DECEMBER 31, 2022
SCHEDULE OF CAPITAL IMPROVEMENT FUND
WATER/SEWER UTILITY CAPITAL FUND
122
EXHIBIT D-18
8,441,476.14
$
Increased By:
ARP Funds Received in Current
62,748.80
$
ARP Funds Received Utility Operating
62,748.80
Funding of Costs of Improvements Authorized By Budget
175,000.00
300,497.60
8,741,973.74
$
Balance, December 31, 2022
BOROUGH OF SURF CITY
WATER/SEWER UTILITY CAPITAL FUND
SCHEDULE OF RESERVE FOR AMORTIZATION
YEAR ENDED DECEMBER 31, 2022
Balance, December 31, 2021
123
EXHIBIT D-19
71,250.00
$
Balance, December 31, 2022 and 2021
BOROUGH OF SURF CITY
WATER/SEWER UTILITY CAPITAL FUND
SCHEDULE OF RESERVE FOR DEFERRED AMORTIZATION
YEAR ENDED DECEMBER 31, 2022
124
EXHIBIT D-20
BALANCE
BALANCE
Ordinance
DECEMBER 31,
DECEMBER 31,
Number
2021
DECREASED
2022
2009-07
Improvements to Water & Sewer System
35,000.00
$
35,000.00
$
-
$
2018-16
Improvements to Water & Sewer System
225,000.00
140,000.00
85,000.00
2021-15
Rehabilitation of Borough Water Tower
783,750.00
125,497.60
658,252.40
1,043,750.00
$
300,497.60
$
743,252.40
$
Funded By Budget Appropriations
175,000.00
$
Grant Receipts
125,497.60
300,497.60
$
Purpose
YEAR ENDED DECEMBER 31, 2022
BOROUGH OF SURF CITY
WATER/SEWER UTILITY CAPITAL FUND
SCHEDULE OF BONDS AND NOTES AUTHORIZED BUT NOT ISSUED
125
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126
GENERAL FIXED ASSETS ACCOUNT GROUP
127
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128
EXHIBIT E-1
BALANCE
BALANCE
DECEMBER 31,
DECEMBER 31,
2021
ADDITIONS
DELETIONS
2022
Land
748,506.36
$
-
$
-
$
748,506.36
$
Buildings
1,017,160.67
-
-
1,017,160.67
Equipment
739,828.63
65,479.00
7,600.00
797,707.63
Motor Vehicles
3,088,894.62
-
26,000.00
3,062,894.62
5,594,390.28
$
65,479.00
$
33,600.00
$
5,626,269.28
$
BOROUGH OF SURF CITY
YEAR ENDED DECEMBER 31, 2022
SCHEDULE OF GENERAL FIXED ASSETS
GENERAL FIXED ASSETS ACCOUNT GROUP
129
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130
BOROUGH OF SURF CITY
PART II
SCHEDULE OF FINANCIAL STATEMENT FINDINGS -
GOVERNMENT AUDITING STANDARDS
FOR THE YEAR ENDED DECEMBER 31, 2022
131
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132
BOROUGH OF SURF CITY
SCHEDULE OF FINANCIAL STATEMENT FINDINGS
FOR THE YEAR ENDED DECEMBER 31, 2022
Section II – Financial Statement Findings
This section identifies the significant deficiencies, material weaknesses and instances of noncompliance
related to the basic financial statements that are required to be reported in accordance with Government
Auditing Standards and with audit requirements prescribed by the Division of Local Government
Services, Department of Community Affairs, State of New Jersey.
Finding 2022-001*
Criteria or specific requirement:
In accordance with maintaining an internal control environment that is effective in the prevention and/or
identification of potential financial statement misstatement and/or misclassification, the Borough should
properly maintain a complete and accurate general ledger system.
Condition:
The general ledger was not properly maintained in the Borough’s main financial reporting system
(Edmunds).
Context:
The Borough did not maintain or reconcile the subsidiary ledgers to the financial reporting system within
Edmunds.
Effect or potential effect:
The Borough does not have proper support for general ledger balances and transactions.
Cause:
The Borough maintained a separate, stand alone general ledger outside of the Edmunds accounting
software package.
Recommendation:
That internal control policies and procedures should be developed to properly maintain a single general
ledger system.
View of responsible official:
The responsible official agrees with this finding and will address the matter as part of their corrective
action plan.
*Denotes Prior Year Finding
133
BOROUGH OF SURF CITY
SUMMARY SCHEDULE OF PRIOR YEAR AUDIT FINDINGS
FOR THE YEAR ENDED DECEMBER 31, 2021
This section identifies the status of prior year findings related to the financial statements, federal awards
and state financial assistance that are required to be reported in accordance with Government Auditing
Standards, Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative
Requirements, Cost Principals, and Audit Requirements for Federal Awards (Uniform Guidance), and
New Jersey OMB’s Circular 15-08.
Financial Statement Findings
Finding 2021-001
Condition:
The general ledger was not properly maintained in the Borough’s main financial reporting system
(Edmunds).
Current Status:
This finding has not been corrected.
FEDERAL AWARDS
N/A – No Federal Single Audit in prior year.
STATE FINANCIAL ASSISTANCE
N/A – No State Single Audit in prior year.
134
BOROUGH OF SURF CITY
PART III
LETTER OF COMMENTS AND RECOMMENDATIONS – REGULATORY BASIS
FOR THE YEAR ENDED DECEMBER 31, 2022
135
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136
BOROUGH OF SURF CITY
OFFICIALS IN OFFICE AND SURETY BONDS
The following officials were in office at December 31, 2022:
Amount
Corporate
Name of Official
of Bond
Surety
Francis R. Hodgson, Sr.
Mayor
William D. Hodgson
Council President
John McMenamin
Councilman
Gerry Little
Councilman
Peter M. Hartney
Councilman
James B. Russell
Councilman
Jacqueline Siciliano
Councilwoman
Christine Hannemann
Borough Administrator
*
JIF
Municipal Clerk
Assessment Search Officer
Registrar of Vital Statistics
Michael Gross
Chief Financial Officer,
*
JIF
Treasurer Water/Sewer Rents
Municipal Court Judge
*
JIF
Court Administrator
*
JIF
Assessor
Solicitor
'DQLHO)6DKLQ
Tracey Figueiras
Walter R. Higgins, Jr.
Christopher J. Connors, Esq.
Frank Little
Engineer
All of the bonds were examined and appear to be properly executed.
* Joint Insurance Fund (JIF) Blanket Crime coverage in the amount of $1,000,000.00
Title
137
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138
Honorable Mayor and Members
of the Borough Council
Borough of Surf City
County of Ocean
Surf City, New Jersey
In accordance with requirements prescribed by the Division of Local Government Services, Department
of Community Affairs, State of New Jersey, the following are the General Comments and
Recommendations for the year ended December 31, 2022.
GENERAL COMMENTS:
Contracts and Agreements required to be advertised by (N.J.S.A.40A:11-4)
N.J.S.A.40A:11-4 states every contract or agreement, for the performance of any work or furnishing or
hiring of any materials or supplies, the cost or the contract price whereof is to be paid with or out of
public funds not included within the terms of Section 3 of this act, shall be made or awarded only by the
Governing Body of the contracting unit after public advertising for bids and bidding therefore, except as
is provided otherwise in this act or specifically by any other Law. No work, materials or supplies shall be
undertaken, acquired or furnished for a sum exceeding in the aggregate the bid threshold, except by
contract or agreement.
The bid threshold in accordance with N.J.S.A. 40A:11-4 was $44,000 for the year ended December 31, 2022.
It is pointed out that the governing body of the municipality has the responsibility of determining whether
the expenditures in any category will exceed the statutory minimum within the fiscal year. Where
question arises as to whether any contract or agreement might result in violation of the statute, the
solicitor's opinion should be sought before a commitment is made.
Inasmuch as the system of records did not provide for an accumulation of payments for categories for the
performance of any work or the furnishing or hiring of any materials or supplies, the results of such an
accumulation could not reasonably be ascertained. Disbursements were reviewed, however, to determine
whether any clear-cut violations existed.
Our examination of expenditures did not reveal any individual payments or contracts in excess of the bid
threshold “for the performance of any work, or the furnishing of any materials, supplies or labor” other
than those where bids had been previously sought by public advertisement or where a resolution had been
previously adopted under the provisions of N.J.S.A.40A:11-6.
Collection of Interest on Delinquent Taxes and Assessments
139
N.J.S.54:4-67, provides the method for authorizing interest and the maximum rates to be charged for the
nonpayment of taxes or assessments on or before the date when they would become delinquent.
The governing body on January 2, 2022 adopted the following resolution authorizing interest to be
charged on delinquent taxes:
NOW THEREFORE, BE IT RESOLVED, that if said taxes are deemed to be delinquent for non-
payment of taxes, the Tax Collector shall charge eight (8%) percent per annum on the first
$1,500.00 of the delinquency, and eighteen (18%) percent per annum on any amount in excess of
$1,500.00; and
BE IT FURTHER RESOLVED, by the Borough Council of the Borough of Surf City, that the Tax
Collector shall allow that no interest will be charged on payments received and made by the tenth
calendar day following the date upon which the same became payable; and
BE IT FURTHER RESOLVED, by the Borough Council of the Borough of Surf City, that the Tax
Collector shall charge, in addition to the interest for delinquent taxes, as noted above, a penalty
of six (6%) percent of the amount of the delinquency in taxes in excess of $10,000.00 to a
taxpayer who fails to pay the delinquency prior to the end of the calendar year.
It appears from an examination of the Collector's record that interest was collected in accordance with the
foregoing resolution.
OTHER COMMENTS (FINDINGS):
*Finding 2022-001 (Finding 2022-001 in the Schedule of Findings and Recommendations section)
The general ledger was not properly maintained in the Borough’s main financial reporting system
(Edmunds).
RECOMMENDATIONS:
Finding 2022-001
That internal control policies and procedures should be developed to properly maintain a single general
ledger system.
*Denotes Prior Year Finding
140
Appreciation
We express our appreciation for the assistance and courtesies extended to the members of the audit team.
Respectfully submitted,
HOLMAN FRENIA ALLISON, P. C.
Jerry W. Conaty
Certified Public Accountant
Registered Municipal Accountant
RMA No. 581
Lakewood, New Jersey
September 27, 2023
141
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"...Audit Findings and Questioned Costs as Prepared by Management 134 Letter of Comments and Recommendations - Regulatory Basis: Officials in Office and Surety Bonds 137 General Comments & Findings 139 Acknowledgment 141 PART II PART III ************ BOROUGH OF SURF CITY COUNTY OF OCEAN, NEW JERSEY PART I INDEP..."
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Apr 2, 2026
Last Info Update
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